Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

BRITISH RAILWAYS (No. 2) BILL (By Order)

GREATER LONDON COUNCIL (GENERAL POWERS) BILL (By Order)

LONDON TRANSPORT BILL (By Order)

Orders for Second Reading read.

To be read a Second time upon Tuesday next.

LONDON TRANSPORT (ADDITIONAL POWERS) BILL (By Order)

Order for Second Reading read.

To be read a Second time upon Thursday 27th February at Seven o'clock.

Oral Answers to Questions — EMPLOYMENT

Deptford (Training Centre)

Mr. Guy Barnett: asked the Secretary of State for Employment if he can now say when the training centre planned for Deptford will be built.

The Under-Secretary of State for Employment (Mr. Harold Walker): The Manpower Services Commission informs me that discussions are still taking place with the local planning authorities concerned. There is nothing I can add to the reply which I gave to my hon. Friend on 11th December 1974.—[Vol. 883, c. 167–8.]

Mr. Barnett: Is my hon. Friend aware that this is an entirely unsatisfactory situation? Does he appreciate that there is no skillcentre in any of the four South-East London boroughs? Does he realise that it is an area of high demand for skilled labour because it is an old traditional engineering and industrial area? What will he do to speed things up to ensure that this vital need on the part of industry in South-East London is satisfied quickly?

Mr. Walker: I share the anxiety of my hon. Friend. There is a need to make more rapid progress with the development of the site. I know that the Training Services Agency shares our anxiety. I am sure my hon. Friend knows that it is a difficult site to develop because of the number of planning authorities involved and because of the intersection of waterways. There are training centres and skillcentres which provide a service covering the area to which my hon. Friend has referred. I refer particularly to those in Enfield and Waddon and to the annexe at Sydenham. I share my hon. Friend's anxiety that we should make progress, and I will draw the attention of the planning authorities to his remarks.

Oil Drilling Technology

Mr. Woodall: asked the Secretary of State for Employment if he can now say


what provision is to be made for training in oil drilling technology.

Mr. Harold Walker: I am informed by the Manpower Services Commission that a drilling technology training centre is being established in Scotland with the aid of funds from the Manpower Services Commission. The centre will provide courses in drilling technology for graduate engineers and senior rig crew. The initial phase will be located at Livingston and should become operational this summer.

Mr. Woodall: I thank my hon. Friend for that reply. Will he now say what sort of numbers he expects to be able to train and who will be meeting the cost?

Mr. Walker: When the centre becomes fully operational we expect that it will have an annual throughput of about 600 trainees a year. The capital cost is estimated at £255,000 for the initial stage. That is being met by a grant from the Manpower Services Commission and by a loan which the Training Services Agency has been authorised to make. My hon. Friend asked about operating costs. Our eventual aim is to make the centre self-supporting. The Manpower Services Commission has authorised the Training Services Agency to offer a grant to meet any shortfall until the build-up has reached full occupancy.

Mr. Sproat: Will the Minister confirm that the site at Livingston will not necessarily be the permanent long-term centre for oil drilling technology training and that the Government's mind is still open about where the major development should be sited? Does the hon. Gentleman accept that many people regard it as crazy that the centre of oil drilling technology training should be relatively far removed from the centre of oil activity and where oil personnel are situated—namely, Aberdeen and the North-East?

Mr. Walker: The hon. Gentleman will recognise, as I said in my original answer, that this is the initial phase. The permanent site is primarily a matter for the Petroleum Industry Training Board. The board is considering a number of sites for the permanent centre.

Social Contract

Mr. Stanley: asked the Secretary of State for Employment whether he will now revise the terms of the social contract.

Mr. Lawson: asked the Secretary of State for Employment what proposals he has for amending the social contract.

The Secretary of State for Employment (Mr. Michael Foot): The social contract concerns the whole range of common objectives which the Government seek to pursue in concert with the TUC, but perhaps hon. Members in their Questions are more specifically concerned with the guidelines on wage settlements. Since these are the TUC's guidelines, any amendment of them would clearly be a matter for the TUC. What the Government wish to see is not changes in the guidelines but the maximum possible compliance with them.

Mr. Stanley: Is it not clear that the ever-elastic social contract is producing a rate of wage inflation way beyond what the economy or public or private industry can afford? As the social contract is now actively stoking up unemployment, will the right hon. Gentleman measure up to his national responsibilities and reduce the rate of wage inflation? If he is unwilling to do that, will he, in the national interest, resign?

Mr. Foot: The hon. Gentleman is wrong on every count and especially, if I may say so, on the last. It is not the case that compliance with the social contract is causing the difficulties that he describes. It is our desire, as I said in my orginal answer, to secure the maximum possible compliance. The increases that have taken place and the inflation that has taken place have been due not to the social contract but to other factors altogether.

Mr. Noble: Will my right hon. Friend accept that his comments on the social contract should take account of the fact that there have been Government measures to remove anomalies, particularly in regard to the teachers? Will he note that there still remains a grave anomaly, as set out in Early-Day Motion


No. 254, signed by over 50 Members? Will he draw that motion to the attention of his right hon. Friend the Secretary of State for Education and Science with a view to the removal of that anomaly?

Mr. Foot: I have had Early-Day Motion No. 254 drawn to my attention, notably by my hon. Friend the Member for Bedwellty (Mr. Kinnock), who never ceases to put these matters to me with his customary force and skill. I assure my hon. Friend that we are fully aware of that motion and I am sure that my right hon. Friend the Secretary of State for Education and Science will take proper note of it.

Mr. Lawson: Is it not sheer humbug to pretend that the miners' settlement is within the social contract? If the Secretary of State is genuinely concerned to secure greater compliance with the terms of that contract, would it not help if he were to echo the warning of his right hon. Friend the Chancellor of the Exchequer that non-adherence by the unions to the social contract will inevitably lead to mass unemployment?

Mr. Foot: Perhaps I could recommend the hon. Gentleman, before making these judgments, to read the speech which I made at the weekend.

Mr. Lawson: I have.

Mr. Foot: Perhaps the hon. Gentleman read it in the newspapers. The speech was reported and even more widely misreported, in the newspapers. I hope he will read the whole speech, which sets the miners' settlement in proper perspective. I said in that speech that it was undeniable that the settlement went beyond the guidelines in keeping up with the cost-of-living figures. That is true, but there are many other factors to be taken into consideration. All in all, I believe that the miners' settlement was a good one for the miners, the industry and, above all, for the country.

Mr. Arthur Lewis: If and when my hon. Friend announces a revised social contract, will he think up a scheme within the contract to provide that on occasions when Conservative Members and Press and television reporters criticise poorer paid people on receiving wage increases, those criticis should declare

how much they receive for their articles, which is sometimes as much as £200 or £300, or for a few minutes' contribution on radio or television, namely, a fee of £40 or £50? Will they not remember those large fees when they are condemning the miners for trying to achieve £30 or £40 a week?

Mr. Foot: I agree that such declarations would take the edge off televsion perorations.

Mr. Tugendhat: Will the right hon. Gentleman give the House the benefit of his view on the remarks by Mr. Scargill last night that it is not a social contract but a social "con" trick and that the miners were right to act in defiance of it?

Mr. Foot: I disagree with what Arthur Scargill said on the subject of the social contract. I happen to agree with the policy of the NUM on the matter—namely, with what the NUM said at its conference and at the Trades Union Congress.

Disabled Persons

Mr. Marten: asked the Secretary of State for Employment what is the level of unemployment of registered disabled compared with a year ago.

Mr. Harold Walker: I regret that I cannot provide more up-to-date information than that which I gave to the hon. Member on 5th November 1974, when I said that 59,882 registered disabled people were unemployed in September 1974 compared with 66,259 in September 1973.

Mr. Marten: Does the Minister agree that there are still far too many registered disabled who are unemployed? What is the proportion of employers who do not come up to the 3 per cent. standard? Is he satisfied that employers are doing their best?

Mr. Walker: No, I am not satisfied with the present position. For that reason I recently instituted a scheme of purging what I consider to be the black spots. We have selected six areas for intensive enforcement of the scheme. If at the end of a six-months' period that is seen to be effective, we shall give careful consideration to repeating the exercise elsewhere.
I am sorry that I cannot give the hon. Gentleman the figure he seeks. The situation is complicated since we have to distinguish between firms which fall behind the 3 per cent. quota—which require the permission of the Department—and those which do not have departmental permission. I shall let the hon. Gentleman have the figures, but I repeat that I am far from satisfied with the position. There are far too many employers without a quota at present. I am prepared to do all I can to bring employers within the 3 per cent. requirement.

Mr. Leadbitter: My hon. Friend will agree that the expression of intent is made several times every year but is not followed by any specific action. Does he agree that the best way to encourage employers to take a proper quota of these workers is to examine the performance of all Government Departments, local authorities and public utilities? Does he agree that if the Government, as one of the largest employers in the land, were to set an example, other employers elsewhere might follow suit?

Mr. Walker: When I referred to a repetition of the present exercise which I have inaugurated, I did not see this as an on-going operation. My hon. Friend will appreciate that a consultative document was issued in 1973 on the future of the quota scheme. Therefore, until the necessary considerations and consultations have been completed we cannot reach final decisions. I agree that some Government Departments have fallen below the quota. I am very much aware of this fact and I have drawn it to the attention of the Departments concerned. I am now asking for information about what the House of Commons is doing in this respect. I hope that the authorities of the House will provide us with that information.

Short-time Working

Mr. Rost: asked the Secretary of State for Employment what is the latest figure of the number of people in short-time work.

The Under-Secretary of State for Employment (Mr. John Fraser): It is estimated that in the week ended 14th December 1974 71,600 operatives in manufacturing industries in Great Britain

were stood off or working short time. Information about short time amongst other workers is not available.

Mr. Rost: The figures are hopelessly out of date. How much more acceleration in price and pay inflation leading to mass unemployment and short-time working will the Minister preside over before he accepts ministerial responsibility for the non-existence of the social contract? What does he do in his Department while the country inflates into bankruptcy and recession?

Mr. Fraser: My right hon. Friend the Secretary of State for Employment does a great deal more to ensure a high rate of employment than did his predecessors at the Department. On the question of short-time working, I must ask the hon. Gentleman to await publication of the figures later this month. There has been a small drop in the December figure compared with November. Short-time working exists mainly in the consumer and the motor car industries and cannot be attributed to wage inflation.

Mr. Hayhoe: Will the hon. Gentleman give an assurance that we shall have the full figures of short-time working and unemployment in the normal way later this month?

Mr. Fraser: I cannot say whether the figures on short-time working will be published later this week, but on 20th February the normal figures on vacancies will be published.

May Day

Miss Richardson: asked the Secretary of State for Employment if he will give consideration to declaring 1st May a paid public holiday.

The Minister of State, Department of Employment (Mr. Albert Booth): The Government have received a number of representations about the declaration of a May Day bank holiday which we are at present considering.

Miss Richardson: I welcome that reply, particularly since the undertaking to consider the matter was included in Labour's programme in 1973. I am sure the House will agree that such a move will make a great gesture towards the operation of the social contract. May I underline that such a holiday must be


paid? We should remember that certain industries with wages councils have to specify holidays or there is no obligation to pay. Many people were not paid for New Year's Day because of this situation and, therefore, I hope that 1st May will be regarded as a paid holiday.

Mr. Booth: Bank holidays apply in law only to banking and certain other financial institutions. Nearly all employers in England and Wales observe them as paid holidays. I am confident that they will observe any new bank holiday that is instituted.

Miss Fookes: Will the Minister say what celebration we are supposed to be having on 1st May as a public holiday?

Mr. Booth: It might be more appropriate if we announced that at a time when we are ready to declare May Day as a public holiday. I am surprised to find any hon. Member who is not aware of the tremendous political significance of May Day to the whole of the Labour movement.

Retraining (EEC Grants)

Mr. Blaker: asked the Secretary of State for Employment how much the United Kingdom has been allocated for retraining from the EEC Social Fund since 1st January 1974; and what further applications he is now making.

Mr. Hurd: asked the Secretary of State for Employment what grants have been allocated to the United Kingdom for retraining purposes from the EEC Social Fund since 1st January 1973; and what further applications by his Department for such grants are still pending.

Mr. John Fraser: For 1973 about £19 million; a further £19 million for 1974; and £6 million so far for 1975. Training applications in respect of 1975 still pending amount to £10·5 million. Further applications will be submitted in respect of Government-operated schemes of training, to run from August 1975 into 1976, and yet other applications, including some of a smaller scale and non-governmental, are expected to be submitted as the year progresses.

Mr. Blaker: Is the Minister aware that those figures are welcome? In view of the importance of retraining, especially

when the Secretary of State is pressing for more investment in new machinery, will the hon. Gentleman give an assurance that, in consultation with the Secretary of State for Industry, he is pressing, and will continue to press, for the maximum possible allocation to Britain from the fund?

Mr. Fraser: I give the hon. Gentleman the assurance that my Department seeks the maximum possible allocations from the Social Fund for training and for other purposes.

Mr. Hurd: Can the Minister say what proportion of the Government's training programme is now financed by the EEC? Will he confirm what I think he said in his original answer, that the processing and preparation of applications will go on without any check so that the applications will be submitted before next year?

Mr. Fraser: I cannot, without notice, give the hon. Gentleman the proportion of the total cost of that training programme paid out of the Social Fund. There was no delay in submitting the applications which were made. I am anxious that the Commission should deal with them quickly and pay the money quickly after making the allocation.

Manpower Services Commission

Mr. Watkinson: asked the Secretary of State for Employment if he is satisfied with the operation of the Manpower Services Commission; and if he will consider expanding its activities.

Mr. Hooley: asked the Secretary of State for Employment if he will take steps to enable the Manpower Services Commission to have a fully effective manpower intelligence and planning function.

Mr. Foot: I am satisfied with the present operations of the Manpower Services Commission. As proposed in the Labour Party manifesto, we are considering how to expand the commission's role. That expansion will certainly include an enlargement of the commission's manpower intelligence and planning function. The commission is about to recruit a Director of Manpower Intelligence and Planning whose first task will be to assess the commission's needs in this field.

Mr. Watkinson: Will my right hon. Friend confirm that the Manpower Services Commission is advocating an expansion programme, and will the Government adopt that programme? Will he take note that although there are over half a million school leavers each year only 200,000 are at present receiving training, which compares badly with our European neighbours?

Mr. Foot: On the question of the expansion of the rôle of the Manpower Services Commission, I have already referred to the Labour Party manifesto on the subject, which we intend to carry out in this particular as in other particulars. We are holding further discussions with the Manpower Services Commission on these and other matters later this month. As regards the problems of school leavers, I hope that the proposals of the Manpower Services Commission and the Training Services Agency, which we were discussing, will lead to an improvement. That is what we desire. We think that that is a most important aspect of the problem.

Mr. Marten: This has been going on for quite a long time. Is there any reason why the advice of the Manpower Services Commission should not be fed back to undergraduates and school leavers straight away and without waiting?

Mr. Foot: It is not only a question of feeding back information. I did not understand that from my hon. Friend's question. I think it is also a question of providing further training facilities, to which I thought my hon. Friend referred. That is what we are seeking to work out, and we are in constant touch with the Manpower Services Commission about it.

Retraining Schemes (Rural Areas)

Mr. Cormack: asked the Secretary of State for Employment what arrangements he is making to review retraining schemes in rural areas.

Mr. Harold Walker: The Manpower Services Commission informs me that the Training Services Agency is expanding the training opportunities scheme and that the increased facilities will benefit those living in rural areas. In addition, the Council for Small Industries in Rural Areas has embarked on an expansion

programme designed to increase the range and scope of training which it provides in traditional rural crafts and other occupations.

Mr. Cormack: While thanking the Under-Secretary of State for that reply, may I point out that forestry is one of our most important rural industries? May I stress the necessity for the Chancellor of the Exchequer to clarify his recent welcome capital transfer tax concessions with regard to forestry? Will the hon. Gentleman tell us what plans he has specifically to encourage young men to take up forestry?

Mr. Walker: The latter part of the question is obviously a matter for the Training Services Agency. I should require notice to find out exactly what is happening. As regards the first part of his question, the hon. Gentlement has had his opportunity to make his point to the Chancellor about the excellent capital transfer tax which was proposed by my right hon. Friend.

Mr. Guy Barnett: Is my hon. Friend aware that the best opportunities are available for young people wanting to go into forestry if they enter the Forestry Commission?

Mr. Walker: I take note of that.

Professional Executive Recruitment Service (Scotland)

Mr. David Steel: asked the Secretary of State for Employment if he will now take steps to increase the Professional Executive Recruitment Service in Scotland.

Mr. John Fraser: I am informed by the Manpower Services Commission that no immediate increases are contemplated, but the needs of the service are being kept under close review.

Mr. Steel: Will the Minister confirm that local authorities are not obliged to use this service? Does he not think that it would be good if they did so, in view of the reorganisation of local Government?

Mr. Fraser: I have discussed this matter with the PER. I hope that local authorities will make use of the service. I am sure that the PER will do everything


possible to encourage notification of vacancies from local authorities.

Sir P. Bryan: Clients of PER obtain the services of PER below cost. The PER is subsidised to the tune of about £600,000 a year. Do foreign clients receive a subsidised service? For instance, I have seen PER advertisements in the Sunday Times for jobs in Saudi Arabia and South Africa to the tune of £13,000 a year. Do those foreign clients receive the subsidised service or do they pay the true cost?

Mr. Fraser: The aim of the PER is to be self-financing, apart from payments from the Government for the social cost of the scheme. The PER is now moving towards the self-financing target. The advertising of foreign vacancies will to that small extent be subsidised. I am glad to see that PER is competing with private agencies, and long may it do so.

Employment Protection Bill (Consultation Document)

Mr. Brittan: asked the Secretary of State for Employment whether he will publish the representations he has received about the consultative document on the proposed Employment Protection Bill.

Mr. Foot: All the representations we have received about the Employment Protection Bill are being carefully considered but, in accordance with usual practice, I shall not be publishing them.

Mr. Brittan: Does the Secretary of State agree that however attractive some of the proposals in the proposed Bill may be, their implementation will add enormously to the costs of industry, especially to the small businesses which are now suffering badly? Will he give his estimate of the cost of the implementation of those proposals or at least undertake to publish an estimate in the near future?

Mr. Foot: I am sure the hon. Gentleman will agree that the proper time for the House to discuss these matters is when the Bill is presented. When that is done, we shall give estimates of what we believe to be the economic consequences of these measures. I do not accept the hon. Gentleman's view that this will impose an enormous burden of industry. Representations have been made to us on that subject. We have taken them into account. However, the Bill also offers great advan-

tages for industry, including the carrying out of a further item in the social contract. I know how much the hon. Gentleman wishes to comply with it.

Mr. Tomlinson: Will my right hon. Friend take note that, rather than wishing for publication of the representations that have been received on the consultative document, most of his right hon. and hon. Friends are waiting for him to publish the Employment Protection Bill, which is of far greater priority than the consultations, although obviously the consultations must be taken into account?

Mr. Foot: I agree with my hon. Friend that that is the best way to go about it. I hope that a Bill will be introduced to the House of Commons in March, before Easter. The sooner we can make progress with it, the better.

Mr. Tugendhat: Before Christmas, the Secretary of State said that the Bill would be introduced in January. Before that, he said that it would be introduced before Christmas. Is not this an example of how mucked up the Government's legislative programme has become? Does the right hon. Gentleman believe that he will be able to get a measure of this sort through the House this Session together with the referendum proposals and everything else?

Mr. Foot: Everybody knows that we will get the referendum through. We certainly intend to get the Bill through too. I hope that the hon. Gentleman is not hinting at any conceivable obstruction, because this is one of the central Bills in the carrying out of the social contract, and I know how eager Conservative Members are for that.

Homeworkers

Mr. Rooker: asked the Secretary of State for Employment what representations he has received concerning provisions for homeworkers in the Employment Protection Bill.

Mr. Harold Walker: A number of points about the operation of the Wages Councils Act in relation to homeworkers have been raised, principally by the TUC, and have been the subject of discussion between officials of my Department and of the TUC.

Mr. Rooker: Does my hon. Friend accept that the TUC deserves congratulation on taking up at long last the plight of the homeworkers? Is he aware that only about half of the many thousands of homeworkers are registered with local authorities as required by law? If he does not include them in the Employment Protection Bill, will he take steps to tighten up that regulation?

Mr. Walker: I know that my hon. Friend has done a lot of homework on this subject and will therefore be aware that the requirement for registration under the Factories Act is limited to a number of scheduled trades and occupations and is primarily for health and safety purposes. The Health and Safety at Work etc. Act empowers the Health and Safety Commission to introduce a more comprehensive register. I agree that there is a problem here. I am glad that the TUC has drawn attention to it. We are giving further careful consideration to how best we can tackle the problem of homeworkers and the need for more protection for them.

Mr. Tomlinson: Does my hon. Friend accept that there will be a major travesty if the Employment Protection Bill does not adequately deal with this vast area of exploited labour? This is a section in which large numbers of people are totally exploited. The Employment Protection Bill will have a hollow ring unless it deals with this problem.

Mr. Walker: One way in which the Employment Protection Bill will make a contribution—I do not pitch it any higher—is by the inclusion of a provision to amend the definition of "worker" as defined in the Wages Councils Act, so that it will clearly cover homeworkers. This will give wages councils more effective power to safeguard homeworkers' earnings. Many homeworkers are not in wages councils industries. I recognise that there is a problem here and, as I said, we are giving very careful consideration, particularly in the light of two recent CIR reports, to how best to follow up the recommendations made by the CIR. I have in mind particularly CIR Report No. 77.

Editorial Freedom

Mr. McCrindle: asked the Secretary of State for Employment how many com-

munications he has received on the subject of editorial freedom in connection with amendments of the law since 11th October 1974.

Mr. Foot: My hon. Friend and I have received about 100 communications from about 75 sources, suggesting various forms of proposed statutory safeguards.

Mr. McCrindle: Has the Secretary of State seen the suggestion by Lord Goodman that the only person who is convinced that he is introducing a new charter of liberty for the British Press is the right hon. Gentleman himself? Is there any chance that the Secretary of State is likely to repent at later stages of the Bill, or does he propose to continue as the self-appointed defender of a freedom of the British Press which is not agreed to by the whole of Fleet Street?

Mr. Foot: The House came to a healthy conclusion on the matter in the recent debate. On Third Reading the House gave its verdict, which happened to concur with my view on the matter. I am gratified by its conjunction. It is most ill-advised of the hon. Gentleman or anyone else, including Lord Goodman, to cast aspersions on the charter for the freedom of the Press which is being discussed in another place. Progress is being made with that proposal. For anybody in any quarter to cast aspersions on it is most misguided, because I believe that that is the real way to protect the freedom of the Press.

Mr. Cryer: Will my right hon. Friend arrange to investigate the editorial policies of the Daily Express which, in adopting cheque book journalism, is restricting access to the right hon. Member for Walsall, North (Mr. Stonehouse) and, in the terms of one of the more recent victims of that newspaper's cheque book attitude, is behaving like the KGB? Will he ensure that when the referendum starts, freedom of the Press will be given to those who want to get out of Europe as well as to those who want to stay in?

Mr. Foot: I have one or two other matters on my mind at the moment without cleaning up the Augean stables in the Daily Express offices. I am not starting on that, even at the invitation of my hon. Friend, and no one would be more persuasive than he in doing so. I believe


that we are making good progress with the Bill. The sooner it is on the statute book, the better for all concerned.

Mr. Hayhoe: Is the Secretary of State aware that, in the opinion of many who are well able to judge, it is he who is misguided on the subject of Press freedom? Will he, even at this late stage, help to facilitate an amendment to the legislation in the House of Lords which would be acceptable in all parts of the House? Is he aware that it would be totally wrong to assume that the vote following his emotive and passionate speech the other night is the end of the matter? It certainly is not.

Mr. Foot: In my opinion, the proper place to decide the whole question is this House of Commons, the elected representative of the people of this country. As I said in the debate, I hope that their Lordships will not poke their noble noses into this matter.

Equal Pay

Mr. Kilroy-Silk: asked the Secretary of State for Employment if he will take further action designed to ensure more rapid progress towards the implementation of equal pay.

Mr. John Fraser: I am currently considering whether to refer collective agreements which contain discriminatory provisions to the Industrial Arbitration Board for advice, and I am in correspondence with a number of negotiating bodies in this connection. I am also conducting a publicity campaign about the Act. My Department is continuing to monitor the state of progress towards equal pay generally and the Advisory Conciliation and Arbitration Service has agreed to my request to continue to provide information and advice on a wide basis to firms which need it.

Mr. Kilroy-Silk: Is my hon. Friend aware that that answer is not dissimilar from a previous answer he gave me in December? Is he further aware that there are far too many discriminatory collective agreements? Will he now take positive and firm action to refer those discriminatory collective agreements to the Industrial Arbitration Board so that more rapid progress can be made in future than in the past towards equal pay?

Mr. Fraser: I am trying to be positive and firm. I am sure that the letters I have sent to negotiating bodies are having a good effect on progress towards equal pay. If I identify agreements which are not being renegotiated and where I do not think that equal pay will be achieved, I shall seriously consider a reference. I am also considering including in the Anti-Discrimination Bill provisions which will enable the Equal Opportunities Commission to investigate and forward the cause of equal pay.

Ports (Employee Participation)

Mr. Dodsworth: asked the Secretary of State for Employment what consultations he had had regarding the extension of worker participation in the ports industry.

Mr. Booth: My right hon. Friend has received many representations from both sides of industry about the Government's commitment to ensure that the coverage of the Dockworkers' Employment Scheme is appropriate to modern conditions. He will shortly be issuing detailed proposals about implementation.

Mr. Dodsworth: I am grateful for that reply. Before the Minister concludes his consultations, will he pay particular attention to the excellent labour relations which have existed and do exist in some privately-owned and operated ports which have been productive without statutory enforcement?

Mr. Booth: Before publishing our detailed proposals we shall take careful account of representations made to us by many sectors concerned with dock work, including those from the private ports which have included references to industrial relations at those ports.

Mr. Leadbitter: Will my hon. Friend bear in mind that we are currently discussing the earliest possible implementation of public ownership of the ports in the United Kingdom? As we are intent on pursuing a large element of worker participation in those proposals, we look forward to Conservative Members, particularly the hon. Member for Hertfordshire, South-West (Mr. Dodsworth), supporting us when the proposals come forward.

Mr. Booth: The public ownership of ports and port reorganisation are matters for my right hon. Friend the Secretary of State for the Environment. In so far as these matters affect industrial democracy in that area, the Department of Employment has a continuing interest and will welcome any developments which port reorganisation may bring about.

Mr. Hayhoe: Are not industrial relations in the private ports much better than in the other ports?

Mr. Booth: Our investigations into the whole industrial relations situation does not lead us to that conclusion.

Wage Guidelines (Compliance)

Mr. Duffy: asked the Secretary of State for Employment if he is satisfied with the degree of compliance with wage guidelines; and whether he will make a statement.

Mr. Foot: As I have said before, the guidelines have had a considerable measure of success and constitute the best basis for the future, but I would emphasise the importance of the maximum possible compliance with them.

Mr. Duffy: Is my right hon. Friend aware that many hon. Members will agree that last week's settlement on behalf of the miners was registered in respect of a unique work force in our economy and that any disposition by other claimants to use it as a gateway will aggravate inflation and undermine the living standards of pensioners and others without power to negotiate?

Mr. Foot: As I said in reply to a previous question, my comments last week put that settlement into its general perspective.

Mr. Fletcher-Cooke: Since compliance with the guidelines is so important, will the Secretary of State reconsider his decision not to publish the details of the guidelines as a State paper?

Mr. Foot: We have been into that before, and I shall be happy to have a discussion on it in the future. It is a much better subject for debate than for question and answer. I do not believe it would be a sensible way of proceeding if we commented on every settlement and

the detail of every settlement, partly because I do not think it would help to deal with inflation.

Mr. George Rodgers: Will my right hon. Friend comment on the activities of the people who invested in a rising stock market and subsequently sold out, having cleaned up a substantial profit? Does he not think that these people similarly should be subject to some guidance so far as income is concerned?

Mr. Foot: That is another question. It is like the invitation of one of my hon. Friends who asked me to clean up the Augean stables. I have a few other things to do, and even Hercules could not do these things in his spare time.

Mr. Prior: Following the question of my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke), may I ask why the right hon. Gentleman takes the view that when it comes to journalists only the House of Commons can decide but that in the matter of the social contract he can decide, without any recourse and information to the House of Commons at all?

Mr. Foot: That is not my view at all. I am strongly in favour of the House of Commons having questions about the social contract, as we have had today, and debates. We had a full debate, initiated by my hon. Friend the Member for Fife, Central (Mr. Hamilton), a few weeks ago on the social contract, but very few Conservative Members turned up, including the right hon. Gentleman himself. I am not complaining, but I think the best way to deal with this is by debating all these questions in the House of Commons.

Mr. Prior: Will the right hon. Gentleman answer the question?

Mr. Foot: I shall do my best to answer any Questions that the right hon. Gentleman puts down. As I have said before—and I believe that the argument we had showed the real reasons for it—we had an exchange of correspondence published in Hansard for the benefit of hon. Members, but I think it would be a mistaken course in the interests of dealing with inflation if we had a detailed publication about each individual wage settlement.

Employment Agencies

Mr. Leslie Huckfield: asked the Secretary of State for Employment whether he will make a statement on his future intentions on private employment agencies, following the representations he has received from the TUC.

Mr. Harold Walker: As I informed the House on 23rd January, my right hon. Friend intends to implement the Employment Agencies Act 1973 but proposes to strengthen it by transferring responsibility for licensing and enforcement to himself. We have it in mind to discuss with the Manpower Services Commission the possibility of its undertaking a study in this field. In the light of the results of such a study and of the experience of the Department in operating the Act, we would be able to review the whole situation.

Mr. Huckfield: Is my hon. Friend aware that many of us on this side of the House feel that merely tightening up and issuing a few more regulations for the control of private employment agencies does not go half far enough? Is he aware that many of us will be happy only when services of this kind are provided only by the Employment Services Agency? Will he reaffirm that it is still his Department's ultimate intention to ensure that this comes about?

Mr. Walker: Certainly we recognise the desirability and the need to strengthen the Employment Services Agency so that it provides a more effective service. I should tell my hon. Friend, however, that this is a much more complex subject than often appears on the surface. I hoped that my reference to a review would have made quite clear that we have by no means ruled out consideration of the eventual abolition of fee-charging placement agencies.

MOTOR INDUSTRY

Mr. Hurd: asked the Prime Minister how many civil servants now report to him directly on the future of the motor industry.

The Prime Minister (Mr. Harold Wilson): I refer the hon. Member to the reply which I gave to the hon. Member

for Mid-Sussex (Mr. Renton) on 11th February.

Mr. Hurd: May I congratulate the Prime Minister and his hat on their safe return together? May I ask him, whatever advice he receives, to accept that for a year more and more people in the Cowley Works have accepted the need for radical change and that it would be a fatal mistake to ask the taxpayer to subsidise an existing set-up, including a complicated and confusing trade union structure? Does the right hon. Gentleman feel that special legislation would be required to implement whatever Sir Don Ryder advises?

The Prime Minister: I recognise the concern of the hon. Member about the position particularly at Cowley. He will know that some months ago British Leyland approached the Government about its problems and the need for investment and said that the company could be viable by cutting out some of the loss-making big sectors, which would probably mean, one might have thought, Cowley and Longridge. We said that we did not believe it right to have a mini car industry and that it should be a full-size industry. We offered to discuss the investment programme, and in the course of our discussion the liquidity problems became clear. Sir Don Ryder is going into this with great vigour and speed. I hope that we shall have a viable British motor car industry.

Mr. Leslie Huckfield: Is my right hon. Friend aware that in 1974, as far as new registration of financial out-turn is concerned, the two multinational corporations, Chrysler and General Motors, which are represented in this country, did considerably worse than British Leyland, as a result of which my constituents in Coventry who work for Chrysler are working only two days a week at the moment? Is there not now a case for extending the terms of the Ryder committee of inquiry to include at least Chrysler as well?

The Prime Minister: I do not think that is necessary at this stage. I discussed these matters and our common interest in this question of employment, investment and trade with the President of the United States. I have made one or two inquiries. Chrysler, with which


my right hon. Friend the Secretary of State has been corresponding, was mentioned. My clear understanding is that on the company's part there is an undeniable intention to continue its operations in the United Kingdom and a readiness to discuss with the British Government how the continuing efficiency of those operations can be secured.

Mr. Heseltine: Can the right hon. Gentleman answer the second half of my hon. Friend's question and say whether the Government are considering legislation which is not currently before the House to deal with the problem of British Leyland?

The Prime Minister: The answer is "No, Sir". But, of course, we have not got the report of Sir Don Ryder and his team. They are, as I said, working very vigorously on this problem. I hope that whatever solution they come up with will be capable of being dealt with under existing legislation, including possibly legislation passed by the previous Government. But if legislation were needed to save a major indigenous industry we would not hesitate to bring it before the House.

TUC (MEETING)

Mr. Atkinson: asked the Prime Minister when he next proposes to meet the TUC.

The Prime Minister: I refer my hon. Friend to the reply which I gave my hon. Friend the Member for Oldham, East (Mr. Lamond) on 11th February.

Mr. Atkinson: Can my right hon. Friend say whether yesterday he had a chance to read the Cambridge Economic Review which set out its case for rejecting totally deflationary policies? Did he also notice in that report that the case was made for the imposition of import controls, which is in line with the policy now being developed by the TUC, has been stated by every trade union which has as yet issued an economic report and is, indeed, supported by no fewer than 100 Members on the Labour back benches?

The Prime Minister: I did not read that until today. From the time the Government came into office we have made

it clear that we reject deflationary policies as a means of solving problems caused to a considerable extent by the oil price situation. To embark on deflationary policies and bring about a diminution of world trade would be bad for us as a major trading nation. The same is true of the use of import controls.

Mr. Peter Morrison: Does the right hon. Gentleman think that the social contract is fair when those who settle within its guidelines have to pay for the excessive wages of those who settle outside them through increased costs of coal and electricity?

The Prime Minister: These matters were fully dealt with by my right hon. Friend the Secretary of State for Employment in the statement he made recently. I entirely agree with what he said. If the hon. Member is referring to the mineworkers' settlement, to which my right hon. Friend referred, I hope he and other hon. Members will recognise that no one in this country, perhaps not even the Tory Party, wants to go back to the confrontation of a year ago. [Interruption.] Perhaps the hon. Member for Lancaster (Mrs. Kellett-Bowman) does, but no one else does. The hon. Member may not have noticed what my right hon. Friend said, namely that this was a major restructuring agreement. Conservative Members will be aware of the need for more coal-face workers. They will also know that we cannot go on—it would be wrong to go on—with the situation in which, through inadequate recruitment to the mines, we have to use that odious practice of underground mining contractors—the lump. What has been agreed is calculated to enable us to solve these structural problems.

Mr. R. C. Mitchell: The Prime Minister has been having meetings with the TUC and the CBI on these matters. Will he also have similar meetings with the new national consumer authority so that the voice of the consumer can be heard?

The Prime Minister: My hon. Friend is quite right. The previous Government scrapped any semblance of consumer representation in this country. We have restored it, at a high level. My right hon. Friend the Secretary of State for Prices and Consumer Protection has made it clear that she will have the closest connection with the new authority. So will I.

Mr. Prior: Will the Prime Minister now answer the question asked by my hon. Friend the Member for City of Chester (Mr. Morrison): whether he considers it is fair that those who make settlements outside the guidelines of the social contract should have those settlements paid for by others who must meet increased prices? Will he further say whether he thinks that a settlement such as that which has been reached by the miners falls within the social contract?

The Prime Minister: That question was answered by my right hon. Friend I agree with him. On the point raised by the right hon. Gentleman I would refer him to the statement—I will send him a copy of it if he has not seen it—made by the right hon. Member for Lowestoft (Mr. Prior) to the effect that the Government were right not to interfere in the negotiations between the NUM and the Coal Board and that the miners had always been a special case. I have the full text here if the right hon. Gentleman would like to read what he said on that occasion. I am interested to hear the language he is now talking, because he was not talking it a year ago.

Mr. Prior: Answer the question.

BRUSSELS

Mr. Rifkind: asked the Prime Minister when he next intends to pay an official visit to Brussels.

The Prime Minister: I have at present no plans to do so, Sir.

Mr. Rifkind: Will the Prime Minister confirm that the recent successful negotiations in Brussels and elsewhere with the African, Caribbean and Pacific countries fully meet the Government's requirements concerning the Third World? Will he confirm that the Third World and New Zealand are anxious that Britain should remain within the Community?

The Prime Minister: The ACP negotiations, on which my right hon. Friend the Minister of Overseas Development reported to the House, were a great achievement. We all take great satisfaction from them. I have publicly stated that I believe that it makes a big contribution to meeting the particular requirement set out in our manifesto. I have had full discussions with the New

Zealand Prime Minister, who says that this is entirely a matter for Britain and the referendum. He told me that New Zealand is anxious about the effect on New Zealand trade with Britain of the terms so meekly accepted by the last Conservative Government, which we criticised at the time. This is because those terms limit what New Zealand can sell us. I am happy to tell the House that we do not accept those terms of 1971 and we are negotiating for a continuance of New Zealand trade with this country, which the Tory Party was prepared to throw away.

Mr. David Steel: Since the renegotiations are now going along so splendidly, may I ask the Prime Minister whether he can tell the House how long it will be before he is able to go to Brussels and assure the British people working there for the Commission that they will not have to pack their bags and come home to join the unemployed?

The Prime Minister: The negotiations are not in the main taking place in Brussels, except in so far as from time to time the Council of Ministers meets there. The negotiations are now in the hands not of the Brussels organisation so much as of the Foreign Ministers. Progress is being made. There is still a very long way to go, as the House knows. I hope we shall make considerable progress on outstanding issues at the summit meeting in Dublin next month.

Mr. Roy Hughes: Will my right hon. Friend make it a fundamental point of the renegotiations that there shall be no interference by the Common Market with the full implementation of the provisions of the Industry Bill when it is enacted, even if this means renegotiating Articles 92, 94 and 189 of the Treaty of Rome? Does he agree that legislation such as the Industry Bill is vitally necessary if the country is to be put on a sound economic footing once again?

The Prime Minister: In all the debates we have had, in this country and overseas, I have always been assured by pro-Marketeers that nothing in the rules or practices of the Common Market is intended to interfere with the right of a member country to take further industries or parts of industries into public ownership. This is what we are always told


and I believe people to be genuine when they say these things. At the moment I am slightly more worried—and it is an important manifesto point—about certain aspects of regional aid and about the ECSC Treaty as it concerns the steel industry.

WALES

Sir A. Meyer: asked the Prime Minister when he next proposes to visit Wales.

The Prime Minister: I hope to do so on 15th March, Sir.

Sir A. Meyer: When the right hon. Gentleman visits Wales, will he take the opportunity to talk to a number of ordinary people and find out what they think about the proposals for an elected Welsh Assembly? Will he find out their views on how much this expensive nonsense will add to their bills as ratepayers and taxpayers?

The Prime Minister: I note what the hon. Member says. He will be aware that our consultative document published last summer was the subject of the most detailed consultations with all organisations in Wales—including the people he no doubt has in mind—and that the White Paper we produced and the ideas put forward in the debate by Ministers exactly reflect the consensus expressed in Wales.

Mr. D. E. Thomas: When the Prime Minister visits Wales, will he visit the steel workers there? Will he explain to them, particularly those in Ebbw Vale, why the Government's redundancy strategy in the report made by the Minister of State, did not include a basic reassessment of the BSC steel strategy? Will he undertake that an investment of £600,000 will be made ready for Ebbw Vale to reline the blast furnaces before there is any further talk of rundown?

The Prime Minister: The hon. Member for Flint, West (Sir A. Meyer) was forthcoming in welcoming the statement made by my right hon. Friend, which affected other areas in Wales and which provides more employment in Shotton, contrary to what the previous Government were proposing some little time ago. My right hon. Friend the Secretary of State for

Employment could answer the question about Ebbw Vale much better than I. It is an extremely difficult problem, going back into history. We are concerned to ensure employment for those working in Ebbw Vale. We believe in the immense power of the British Steel Corporation and the possibility of joint ventures with other employers. This is a problem that can be solved.

Mr. Kinnock: Will my right hon. Friend accept from someone who was born in the Ebbw Vale constituency, who worked in the Ebbw Vale Steelworks for two years and whose father worked there for 27 years until his death, that the interests of the Ebbw Vale steelworkers and the Monmouthshire valleys will not be served by populist, instant answers like those proffered by Plaid Cymru, which seeks to gain a few cheap votes out of the disaster and agony of the men and women of South Wales and Ebbw Vale in particular?

The Prime Minister: My hon. Friend is right. The people of Ebbw Vale know that since 1929 they have had two superb representatives in this House, and they have had and have full confidence in them.

Mr. Hooson: Is the Prime Minister aware that the great concern in Wales is over the tremendous increase in the cost of local government due to the Local Government Act passed by the Conservative Government? Is he prepared to look again at the proposals for a Welsh Assembly, with a view to doing away with one tier of local government before we have this Assembly in Wales?

The Prime Minister: The hon. and learned Gentleman is right. The reform, or whatever it was, or the restructuring of local government by the previous Conservative Government was a disaster not only for Wales but for other parts of the country. It is less democratic, particularly in regard to many aspects of Welsh affairs—one thinks of water as an example—and it is highly costly. We are all bearing the cost of it. We shall look at these matters, but I cannot give any assurance now about what changes will be made. We think that it was done incorrectly last time, and we shall be looking for reforms.

PRIME MINISTER (MOSCOW VISIT)

The following Questions stood upon the Order Paper:—

Mr. Frank Allaun: asked the Prime Minister if he will make a statement on his discussions in Moscow.

Mr. Blaker: asked the Prime Minister whether he will make a statement about his discusions with Soviet leaders during his recent visit to Moscow.

The Prime Minister (Mr. Harold Wilson): Yes, Sir.
I should like to take this earliest opportunity to tell the House about the visit which my right hon. Friend the Foreign and Commonwealth Secretary and I paid to the Soviet Union from 13th to 17th February. It was a visit which followed much careful and patient work on both sides to ensure that it would be fruitful: and when I came to sign the Joint Statement with Mr. Brezhnev, we agreed that our meetings and the agreements which we had concluded laid firm foundations for a new start in the relations between our two countries.
During the course of the visit my right hon. Friend and I had meetings, collectively and seperately, with Mr. Brezhnev, Mr. Kosygin, Mr. Gromyko and other members of the Soviet leadership. Apart from the Joint Statement setting out the results of our meetings, I signed agreements with Mr. Brezhnev dealing with the international non-proliferation of nuclear weapons and consultations between our two countries. I also signed agreements with Mr. Kosygin, dealing with economic, scientific and technological co-operation, in health matters and medical research. Copies of all these agreements are being placed in the Library and will be published as a White Paper as soon as possible.
The House will realise from the nature of these agreements that our discussions covered both multilateral and bilateral questions. On the former there was, of course, no question of negotiation, since other parties are involved. Nevertheless, we had very useful conversations on major world issues and in particular about the steps necessary to bring the work of the

Geneva Conference on Security and Co-operation in Europe to a stage which would justify the early holding of a Summit meeting.
I made clear that if we could now make rapid progress on the two or three outstanding issues at Geneva we should hope to see the conference convene later this year, if possible by the summer.
It would be my hope that a successful outcome for this conference would open up the possibility of making more progress in the Vienna Conference on the Mutual Reduction of Armaments and Armed Forces and associated measures in Central Europe, which we also discussed in Moscow.
The signature of the declaration on the non-proliferation of nuclear weapons is the first bilateral initiative of this kind and will, I trust, give a constructive lead to the Review Conference meeting in Geneva in May.
The House will have seen our joint call for a World Disarmament Conference.
As for bilateral issues we discussed, the Protocol on Consultations is designed to ensure that we build on this new chapter in the relations between our two countries, with a view to enlarging the area of agreement between Soviet views and our own, and to reducing the area of misunderstanding and suspicion.
On trade we identified a wide range of industrial and scientific prospects of mutual interest: and agreed not only to a substantial increase in our trade but also to a better balance in it. This, coupled with the new credit arrangements, involving £950 million for new contracts with British firms, provide the opportunity for our exporters which we have long been seeking. It should bring considerable opportunities for British industry, and additional job opportunities for British workers.
Neither the Soviet leadership nor my right hon. Friend and I concealed the issues on which we differ. The fact that we differ does not mean that we cannot work, each in our own way, towards common aims, bilaterally and within the world setting. This was a visit which concentrated on the areas where practical progress could be made, and, from my experience of negotiations with them over 28 years, I was encouraged by the


extent to which we were dealing in real issues not platitudes.
Perhaps even more to the point, Mr. Brezhnev and I reiterated our joint determination to establish continuing working contracts to implement the agreements we reached in the fullest possible way. As a result I believe that the visit has marked, as we hoped it would, the opening of a new phase in our relations with the Soviet Union—a phase in which there is reason to hope that these relations will be safer, warmer and more constructive than we have enjoyed for a number of years.

Mr. Frank Allaun: Will the Prime Minister accept that this is a hopeful day for détente, a day on which, as Macaulay might has said, even the ranks of the cold warriors could scarce forbear to cheer?
Will my right hon. Friend elaborate on two points—first, on the prospects of more jobs for British workers and, secondly, on what progress was proposed towards nuclear disarmament in line with the non-proliferation treaty, for example, by ending underground tests, as this would go a long way towards preventing the danger of further countries joining the nuclear arms race.

The Prime Minister: I am grateful to my hon. Friend for the welcome that he has given to the agreement. He will be glad to know that the view he expressed is shared elsewhere. For example, in his broadcast at lunchtime Dr. Henry Kissinger gave a warm welcome to what had been achieved, as he did when he congratulated my right hon. Friend and myself last night on these matters.
It was a British initiative that we should seek to have a separate statement on nuclear disarmament. We have put forward certain ideas on tests. This will take a lot more exploration. It has always been a difficult matter. My hon. Friend will be aware of the progress referred to in the joint statement in relation to other aspects of the nuclear problem. We are concerned, for example, about trade in nuclear matters. We are concerned about the control and verification of peaceful nuclear explosions.
My hon. Friend will be glad to know—although this is not in the communiqué—

that we have reached agreement on some degree of co-operation on peaceful nuclear energy because their reactor is one which, while different from ours, has many common components and much common ground with ours.
So far as pressure tubes and other matters are concerned, we hope to have a close relationship with the Russians to supply them with peaceful nuclear technology, and they will supply us with theirs. In this whole field considerable progress has been made.

Mr. Frank Allaun: What about jobs?

The Prime Minister: At the Kremlin lunch Mr. Brezhnev said he thought that what was likely to come out of this would be good for jobs for our people and for the Russian people, too. While the credit facilities are available only in respect of contracts on which progress is made, if anything like this amount of credit is taken up, as my hon. Friend will be capable of calculating, it means a substantial increase in employment for our people in peaceful trade.

Mr. Blaker: Will the Prime Minister confirm that he expects that most of the contracts within the credit of £950 million to which he referred will be met by private industry? If that is so, will he consult his right hon. Friends the Secretary of State for Industry and the Chancellor of the Exchequer to consider whether the best way of putting private industry into a position where it can seize this opportunity with vigour is a policy of browbeating, intimidation and high taxation?

The Prime Minister: Whatever the subject announced, some hon. Gentlemen would have gone off with that kind of intervention. I am glad to tell the hon. Gentleman, because he does not seem to have checked for himself, that before I went to Moscow I met all the top brass and the big companies who for years have traded with the Soviet Union or who are now seeking contracts with them. They said they believed it was necessary to get a new political agreement with the Soviet Union. They are very keen to go ahead. The people concerned include some of the main paymasters of the Conservative Party, and I am surprised that members of the Conservative Party are not reflecting their pleasure in this matter.
Some of the people whom I met were talking of the possibility of agreements for the development, for example, of Soviet raw materials of interest to us where the foreign content of a single development can be between £200 million and £300 million. In that very lengthy meeting no one referred to any of the points which seem to obsess the mind of the hon. Member.

Mr. Wellbeloved: On the Prime Minister's talks about the European Conference on Security and Co-operation, will he say how the Soviet authorities responded to the view that the best way to establish lasting peace and friendship between our two countries is to adopt the Western position on the free flow of people, information and ideas between the Soviet Union and the United Kingdom?

The Prime Minister: We made our position clear on this question and also on the confidence-engendering measures—for example, notification of troop movements—as well as on the outstanding problem on the question of the peaceful change of frontiers. The Soviet leaders fully understand our position. Progress has been made. Given further progress on these three issues—we discussed them with Dr. Kissinger last night and he had been discussing them with Mr. Gromyko in Geneva in the afternoon—I think we can achieve sufficient to delight my hon. Friend and to make the summit conference possible.

Mrs. Thatcher: May I put three points to the Prime Minister? Is he aware that we welcome increasing contact and dialogue with the Soviet Union provided that it never lulls this House or the country into a sense of false security? I think that the Prime Minister will agree with that. I understand that the Prime Minister has agreed to the third stage of the European Conference on Security and Co-operation. Will he say whether he has any concessions in return on, for example, negotiations on easier movement of information across the Iron Curtain?
Thirdly, will the Prime Minister give more detail of the trading agreement, which looks to many of us as though he has brought back from Russia a pretty

good agreement for Russia, bearing in mind that this country has to pay on the usual trading terms for the £400 million of imports annually from Russia? Can he therefore tell us the rate of interest on the new line of credit, what provision there is for depreciation and the period of repayment of each drawing of credit?

The Prime Minister: I am grateful to the right hon. Lady and I thank her for her welcome for my statement. Of course, she is absolutely right that, having reached this considerable measure of agreement, we recognise, they recognise, and our allies and their allies recognise—it is in the communiqué—that there are deep differences of view on important world affairs as well as on our particular constitutional arrangements. However, nothing happened in these discussions or in the agreement that in any way meant any lulling or creation of false security. Some of us are quite old hands on these matters. We started from what had been a pretty cold and chill period in relations leading up to the last few months.
She said that I had agreed to the summit conference. She will be aware from what I said and from the communiqué that this was not unconditional. I said exactly what has been said by other Western leaders, including those of the United States. We are anxious to have as early as possible the summit conference, which has been talked about for five years or more, but only on the condition of sufficient progress being made on the outstanding issues being discussed in Geneva. We discussed these matters. I mentioned them this afternoon. We did not mention them in the communiqué because these are issues for multilateral discussion, and, like the Soviet Union, we have to talk to our allies. We talked to the United States Government last night.
I think that the right hon. Lady fell a little below her usual standards of fairness—[An HON. MEMBER: "You mean she asked a good question."]—and what I know is her desire always to put the most favourable construction on the Government's actions when she said that it was a good agreement for Russian trade. It was a good agreement for trade both ways, because the trade will be both ways.
On the question of the credit, she must be aware, I think, that the terms we have offered are comparable with those involved with other Western countries—for example, France. It has never been the practice of any Government to publish in this House the details of credit agreements. We do not propose to change the policy pursued by the previous Conservative Government for which the right hon. Member, as always, supports the full collective responsibility for everything that then happened.
The interest rate is comparable with that of other countries. Of course, she will recognise that while there may be doubts about why the Soviet Union needs credit, it is a fact of life. If we want this trade, there has to be credit. Every other Western country is trading with the Soviet Union on that basis. We have every vested interest in increasing the Soviet Union's production of copper, pulp, and other scarce materials, which will be of great advantage to our terms of trade.

Mr. Thorpe: Since any contracts will for the most part be with Soviet State trading agencies, and since the Soviet Union exports 50 million tons of oil a year, will the Prime Minister say why this line of credit should be required? Is it not somewhat ironic that we are borrowing what we can from the Shah of Persia and are then extending credit to the Soviet Union? Was there a renegotiation of COCOM in regard to the embargo on the sale of strategically important materials?
On the Anglo-Soviet round table conference which is scheduled, did the Prime Minister, following the time in which Mr. Solzhenitsyn was compelled to leave the Soviet Union and other distinguished people such as the Panovs and Rostropovich wished to leave, gain any indication of a likely relaxation of cultural life in the Soviet Union?

The Prime Minister: I think I have answered the point about credit. It may appear illogical that in their position as the world's biggest oil producer the Soviet Union should require credit. However if we want to trade with them—and we want this trade—it must involve credit according to their practices with every other country.
For the first time in my experience of dealing with the Russians, COCOM was not mentioned. The round table conference proposal by my right hon. Friend the Foreign and Commonwealth Secretary is of great value. We have consulted Chatham House and they are asking one of their established organisations to work together to see whether we cannot get a higher flow of people from our two countries to meet for discussions on almost every subject. This is of great advantage and it will be welcome. Those who talk about opening up the Soviet Union, changing the attitudes of the Russians, and about the issue of personal freedom will be the first to welcome the proposal.
I forgot to reply to one point raised by the Leader of the Opposition. She referred to £400 million of imports from the Soviet Union. I have always regarded that figure with a certain degree of scepticism because it includes £180 million of diamonds which we largely re-export. There is an imbalance and the right hon. Lady will welcome that we are now working not only for more trade but for better balanced trade, and what we are doing will achieve that.
The right hon. Member for Devon. North (Mr. Thorpe) raised the point about various Jewish and other Soviet citizens, including artists, writers and musicians. These matters are always discussed. I have found that after 17 or 18 years of dealing with specific cases it is better not to deal with these matters publicly but to use all the influence that one has. Quite a large number came out as a result of my representations over 18 years. It does not help for me to mention individual names, but I had a telegram from the Panovs thanking me for what I did in getting them out, and from Ruth Alessandrovich.

Mr. Michael Stewart: Did my right hon. Friend find that the fact that this country is a member of the European Community in any way hampered the development of good understanding with the Soviet Union?

The Prime Minister: The matter was discussed briefly in our talks. The Russians rather took exception to the fact that, as a result of no action of theirs, tariffs were now being charged on goods supplied from the Soviet Union to Britain,


because of the assimilation of our tariff rates in respect of countries outside the Common Market. So far one can say that a high proportion of Soviet imports into this country are tariff-free anyway. I was able to give Mr. Kosygin figures of items where the tariffs have been raised. In the small proportion there has been a fall in our imports, most have been unchanged, and in a bigger proportion there has been a continued increase. But I was able to explain to him the position Her Majesty's Government were taking up in relation to the renegotiations and the referendum.

Sir Frederic Bennett: The Prime Minister has said that he does not want to publish full details of the trade agreement, a matter which we understand. However, will he confirm that on the terms stated there can be no material benefit to our balance of payments under any circumstances in less than five years from now? Secondly, the right hon. Gentleman chooses to make remarks about overseas experience. He said that he has been to the Soviet Union 19 times. If by now he does not understand the Soviet Union's motivations, he is either more gullible—or some other worse word—than even I have thought.

The Prime Minister: There is no ministerial responsibility for what the hon. Gentleman thinks whatever it is he thinks with. Therefore, I cannot take responsibility for it.
I do not agree with the hon. Gentleman about the five years. There will be advantage to us within that period, although many of the so-called jumbo contracts—the £100 million, £200 million and £300 million contracts, which our industrialists and their employees are keen to secure—may well be spread in terms of shipments over a considerable period, and therefore in terms of credit as well. I am satisfied

that the agreement is highly advantageous to Britain with regard to trade, payments and employment, as well as the broader issues.
I think that I have dealt with the last part of the hon. Gentleman's question. Some of us have a great deal of experience. There are deep differences. We do not allow any of the trade advantage to the Russians or to us to interfere with basic issues of human relationships or of politics, our alliances and the rest. The Russians do not. We do not. We are both realistic. One day the hon. Gentleman will wake up and know what it is all about.

Several Hon. Members: rose—

Mr. Speaker: Order. These matters must be pursued in other ways.

HOSPITALS (SUTTON AND CHEAM)

Mr. Speaker: The hon. Member for Sutton and Cheam (Mr. Macfarlane) yesterday raised a point about the Hansard record of the Adjournment debate on 5th November last.
These differences of recollection are not easy, particularly when the occasion is over three months ago.
I have considered carefully what the hon. Member said. I also heard the Minister tell the House what he meant to say, and what he thinks that he did say in the relevant part of his speech.
I have consulted the Editor of the Official Report. The reporter's notes confirm what is printed in Hansard. No corrections of any sort were made to that passage in the Minister's speech.
In these circumstances I cannot order any alteration.

TOWN AND COUNTRY PLANNING (ENFORCEMENT ORDERS) BILL

3.55 p.m.

Mr. Michael Marshall: I beg to move,
That leave be given to bring in a Bill to give further powers to local authorities with regard to planning application enforcement orders.
The object of the Bill is to amend Section 90 of the Town and Country Planning Act 1971 so that local planning authorities land enforcement notices may be reinforced by the provision of stop notices covering use as well as operation.
I am delighted to have this opportunity to seek leave to bring in the Bill on the same day as the Dobry Report is published. The report, by a committee which examined the whole question of our development control system, lays great stress on the problems arising from enforcement appeals. Paragraph 6.20, which gives great strength to the Bill, says:
It is clear that the great edifice of enforcement appeals imposes an unfair burden on the authorities, as, subject to planning merits, the vast majority of enforcement notices served are sound and therefore the work involved and the complexity of the system is out of proportion to the need to protect individual rights. There does seem to be a case here for doing streamlining and trying to take a few short cuts.
It is precisely along those lines that I am seeking to introduce the Bill.
When a local authority is considering land planning applications, it has power under the 1971 Act to refuse the applications and to serve enforcement notices for use or operation. Appeal may be made to the Secretary of State under either category. However, a local authority's back-up power of a stop notice extends only to operations and not to use.
I will not burden the House with the legal arguments about operation and use. Many hon. Members will be aware of the problems of definition. For the purposes of the Bill, I briefly describe operations in this context as building, mining, engineering activities of a permanent kind, which will permanently affect the land involved. In the same context, use implies a temporary purposes which has no such permanent effect.
However, it is that kind of use that has led to abuses of the planning procedure. I should like to give two specific examples based on the activities of Sunday trading organisations.
First, in my constituency a company called Grathleigh Ltd. opened a Sunday trading market on the disused Ford airfield in April 1973. A planning application was submitted on 6th June. It was refused and an enforcement notice was served on 18th June. Then, because of the delays in the appeal mechanism which are all too familiar to many hon. Members, it took 15 months for a public inquiry to be held, and 18 months in all before the appeal was rejected. That rejection came only a week or two ago.
Throughout that period the market continued to operate. Stalls were erected and dismantled, and major traffic problems were caused on roads which are not suited to heavy traffic. No rates were paid by the operators. In carrying out the necessary steps under the planning system, the local authority was obliged to incur expenditure running into thousands of pounds. All the while, there was unfair competition to local traders. The operators concerned now freely admit that, having had their appeal refused, they intend to find another airfield where they can begin the same practice once again.
I turn to a second and parallel example. My hon. Friend the Member for Melton (Mr. Latham) will agree. Thanks to the help of the House of Commons Library, and through Mr. Hart in the Library, who has been particularly helpful, I have gathered that a number of other instances are on record on the same problem. In Melton Mowbray, according to my hon. Friend, there is a precisely similar case of a concern which started Sunday trading on a disused airfield, which it had conducted pending appeal against the planning procedure for about two years. I understand that it has now found another airfield where once again the same process has been repeated. My hon. Friend the Member for Melton is in correspondence with the Minister of State to speed up the planning procedure appeal once more.
The only difference between the two examples I have cited is that at least in the case of my hon. Friend the Member


for Melton the operators in his constituency gave him some warning, if only indirectly. I hope, Mr. Speaker, you will take it from me that I am quoting fact and not making some kind of lighthearted post-prandial comment when I tell you that the concern operating in my hon. Friend's constituency is operating under the name of Spook Erections Limited. What is perhaps not insignificant is that the managing director of Spook Erections Limited is also a director of Grathleigh Limited and a leading protagonist in the same argument with my own county council in Sussex. I understand that he has also been active in putting forward similar proposals at Melbourne airfield in Yorkshire.
The whole sequence of events which I have described may be repeated up and down the country, and one of my purposes in bringing this Bill forward this afternoon is to see whether other hon. Members have had similar experience in their own constituencies. I must also assume that the Minister of State and the Secretary of State are both deeply involved in this whole question of planning appeals. For this is my main argument in favour of the Bill this afternoon.
In both the cases I have quoted these matters could easily have been resolved if a stop notice had also been available for use. Much time and expense, both national and local, could have been saved. Potential operators would have seen where they stood and either would have decided to press on despite the appeal

mechanism or, more likely perhaps, would have looked for other sites where their planning applications would be accepted in the first place. There is ample safeguard against the frivolous use of Section 177 of the 1971 Act, under which the local authority is involved in heavy expense if an appeal is upheld.
I therefore ask the House to give me leave to bring in this Bill this afternoon. I am heartened to find that the Dobry Report specifically suggests this change in the existing legislation. I believe that it will be in the interest of our local authorities, our constituencies and the Department of the Environment itself. In these circumstances I look to the Government as well as to the House to find time to make sure that the Bill reaches the statute book.

Question put and agreed to.

Bill ordered to be brought in by Mr. Michael Marshall, Mr. Ian Gow, Mr. Michael Latham, Mr. Robert Hicks, Mr. Douglas Hurd, Mr. Patrick Cormack and Mr. Peter Rost.

TOWN AND COUNTRY PLANNING (ENFORCEMENT ORDERS)

Mr. Michael Marshall accordingly presented a Bill to give further powers to local authorities with regard to planning application enforcement orders: and the same was read the First time; and ordered to be read a Second time upon Friday next and to be printed. [Bill 87.]

Orders of the Day — INDUSTRY BILL

Order read for resuming adjourned debate on Question [17th February], That the Bill be now read a Second time.

Mr. Speaker: I still have more than 20 hon. and right hon. Members who wish to speak from the back benches. I hope that hon. Members will take note of that fact.

4.5 p.m.

Mr. Peter Viggers: I am deeply grateful for this opportunity of continuing the speech which I commenced at two seconds to eleven last night.
This is a controversial Bill not only in what it seeks to achieve but even in the interpretation put upon its power and sphere of activities. To some hon. Members on the Government side it appears a moderate Bill. To others it is the basis of the trade union breakthrough and the dawn of industrial democracy. What is the truth? There are three main purposes of the Bill. The first is to set up the National Enterprise Board, the second is to bring in Planning Agreements and the third is to provide for the provision of information. The last two are linked.
First, on the National Enterprise Board, I am sure that most of us on this side of the House have nothing against the creation of a Government agency to act as a holding board of Government-held stakes in industry. But what an agency this National Enterprise Board is! By Clause 6 the Board is entirely subject to the Secretary of State for Industry. I quote:
… the Secretary of State may give the Board directions of a general or specific character as to the exercise of their functions; and it shall be the duty of the Board to give effect to any such directions.
By Clause 3 of the Bill the Board shall be subject to the Secretary of State's direction in respect of powers previously exercisable under Sections 7 and 8 of the Industry Act 1972. The Board's powers:
… shall not be exercisable by the Board except in any particular case in which the Secretary of State has directed the Board to exercise them.

And,
It shall be the Board's duty to give effect to any such direction.
By Clause 15 all the vital safeguards of the 1972 Industry Act are swept away. First, the Government want to remove the limitation on the Government's powers to purchase shares only where no reasonable alternative exists; secondly, they want to take away the requirement for the disposal of shares as soon as practical; thirdly, they want to take away the limitation of the percentage that may be taken in companies outside the assisted areas to 50 per cent.; fourthly, they want to remove the date—31st December 1977—beyond which there will be no powers to take equity outside the assisted areas.
By Clause 7 of the new Bill there is no real limit on the financial provisions available to the Secretary of State, because the limit of £700 million—which can be extended by agreement to £1,000 million—does not include amounts paid out under Clause 3 of the new Bill. The Secretary of State has virtually a free hand in the expenditure of Government money, subject only to one proviso, and that proviso is not parliamentary but practical. The Secretary of State will be subject to the practical limitation of having to find the money to carry out his plans.
The operation of the National Enterprise Board will depend upon the extent to which the Secretary of State can persuade other Ministers to surrender money from their budgets to enable him to carry through his industrial plans, and to subordinate their budgets to his huge demands. And huge indeed his demands will be. He will need money for the companies already under the wing of the State. They will include British Leyland, which will clearly need hundreds of millions of pounds. They will include the extraordinary experiments at Meriden and Kirkby. And if the Government have their way they will include shipbuilding and aircraft companies. Altogether a massive amount of capital will be required. The expense will be massive, and the benefit to the country is problematical.
I come next to Planning Agreements and the provision of information. There is no doubt that industry and the Government need to co-operate on the basis


of a longer time scale than Government normally contemplate. In the debate yesterday some of my hon. Friends mentioned three to five years as the time scale for decisions in industry. I would maintain that the time scale for a major decision is five or even ten years from the time of the development of the concept to the time that the factory which is the result of the concept is producing.
There is nothing inherently wrong with Planning Agreements or with the provision of information, but—and this goes to the root of the problem—the present Bill envisages information being provided to trade unions, not to employees.
As for Planning Agreements, we heard several hon. Members from below the Gangway—members of the Tribune Group—say yesterday that they saw Planning Agreements and the provision of information as weapons for them to use against management and to help them on the road to increased worker control and nationalisation.
The Government and their supporters claim to speak for workers. But they do not. We can refer to an objective criterion on this by quoting from The Times of 13th January 1975. The Times commissioned the Opinion Research Centre to carry out a survey on opinions about nationalisation. The headline says it all:
Most British workers are against nationalisation".
The findings are based on the views of a sample of 2,000 people who work full-time for organisations employing more than 20 people. They consider the views of employees about whether their employers are doing a good job. People who think that their employers are doing a very good job account for 33 per cent., those who think that their employers are doing quite a good job, 40 per cent., those who think that they are doing only a fair job, 20 per cent., those who think that they are doing a poor job, 5 per cent. Those working for private enterprise tend to think their company is doing a better job than do the employees of nationalised industries.
Another question put was:
On balance which do you think would do more to strengthen British business and industry—for the Government to become more involved with the management and planning

of company affairs, or to be less involved …?
Those who thought that the balance at the moment was about right were 31 per cent. The percentage who thought that the Government should become more involved with the management and planning of company affairs was 19 per cent. Those who thought that the Government should be less involved, leaving companies to run their own affairs, were 46 per cent.
Having established their spontaneous opinion, employees in the private sector were shown two cards, one set suggesting good effects of nationalisation of their own company and one suggesting the opposite. They were asked to say which would happen. Those expecting a better deal for employees under nationalisation were 19 per cent., and those expecting a worse deal for employees were 24 per cent. Those who expected more efficient management under nationalisation were 12 per cent. and those expecting less efficient management were 37 per cent. Those expecting a better deal for people buying the company's products or services were 11 per cent. and those who expected a worse deal for them were 23 per cent. Those who expected better export sales were 10 per cent., and those expecting worse export sales were 15 per cent. But here is the clincher: those expecting fewer industrial disputes and strikes were 9 per cent. and those expecting more under nationalisation were 30 per cent.
The summary is contained in the final question:
Taking everything into account, do you support or oppose the nationalisation of your own company?
Those who supported nationalisation were 18 per cent. Those who opposed it were 67 per cent.

Mr. John Lee: If there is any validity in the arguments which the hon. Gentleman seeks to support by referring to that opinion poll, what does he fear from the disclosure of information to trade unions or workers or, for that matter, to anyone else?

Mr. Viggers: I have nothing against the provision of information. I am in favour of it. It is the use to which it will be put that worries me. If the hon. Gentleman reads yesterday's debate, he


will see that his hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) and other Government supporters said that they saw planning agreements and the provision of information as weapons for them to use against management. It is to that that I object.
If workers are against nationalisation, who is in favour of it? Who wants nationalisation and State control? It is not the employees. They do not want union management. They want good management. The advocates of State control are the pseudo-intellectuals and the commissars-manqués of the Socialist Left wing. What could be more divisive and backward-looking than a petrification of the old battleground between unions and management? That is not the way forward.
We know that industrial investment has been disappointing. But the answer lies away from the sterile field of Socialism, with its spreading tentacles of central Government and its diminution of individual choice and personal freedom.
Investment will follow a restoration of confidence and security, and it flows directly from a fiscal and economic climate in which investment is worth while because it is profitable.
This is not a good Bill. It is vague on key issues, and the powers which it gives to the Secretary of State are unwise. As my hon. Friend the Member for Henley (Mr. Heseltine) said yesterday, we shall repeal it.

4.15 p.m.

The Paymaster-General (Mr. Edmund Dell): The hon. Member for Gosport (Mr. Viggers) will find that I shall deal with many of his remarks during the course of my speech. But I warn him in advance that I shall not be speaking as a commissar manqué.
Again and again throughout the years we have heard in this House from both Front Benchers and back benchers the continual lament about industry's failure to invest, about our poor export performance and about our perennial balance of payments problems. These have been attributed in part to the failures of industrial management and in part to failures of the economic policies of successive Governments.
It is hardly deniable that our economic record since the war has not been one of success, that we have fallen behind our industrial competitors, and that we stand in grave danger of falling further yet. But, however one attributes responsibility for this situation, the truth is that the interventionist policies of successive Governments have not been particularly successful either.
Governments have concentrated too largely on grandiose projects which have diverted resources and skills from stress of our industrial economy which would have brought the nation a higher return. If we examine the record of this country's industrial policy since the war and up until the mid-1960s, at any rate, the area of Government activity which did most beneficial service to our industrial competitiveness was probably the Export Credits Guarantee Department, whose useful functions are seldom the subject of ideological controversy across the Floor of the House.
With the creation in 1966 and 1967 of the Industrial Reorganisation Corporation, there came the beginning of a new approach, a Government agency that could use public money to promote industrial development. I am sure that the fundamental principle of using public money in this way was right. But, in my judgment, the particular IRC approach was in certain respects defective. There was, for example, too great a dedication to mergers. The hon. Member for Colne Valley (Mr. Wainwright) quoted me yesterday as having written that the IRC was too little under Government control. Now that we propose greater Government control, there are further complaints.
On the basis of experience with the IRC, there was a learning process. Part of the learning was indeed by industry, which had opposed the creation of the IRC but came to understand that it had great potential value as an instrument of Government support for industry. I am sure that if a Labour Government had been returned in 1970, the Industrial Reorganisation Corporation would have formed the basis for a further development of constructive Government involvement with industry.
Instead, the Conservative Government abolished the Industrial Reorganisation Corporation. They did so much to the


regret of much of industry. They did so in their Selsdon period of thoughtless disengagement from industry, the period which the hon. Member for Henley (Mr. Heseltine) curiously described yesterday as the period of total abstinence. But it was on the basis of experience with the Industrial Reorganisation Corporation that many of us proposed the creation in this country of a State Holding Company, based on existing Government shareholdings in industry, which could carry forward in new ways the type of work which the IRC had begun.
During the last year and again yesterday, right hon. and hon. Gentlemen opposite quoted words which I used in 1973, and indeed would not now change. Certainly I was against equipping a State Holding Company with powers of compulsory acquisition over the private sector of our economy, and indeed I criticised the extent of the proposed acquisitions. This Bill contains no power of compulsory acquisition, except in one limited case, which I think is welcome to industry and to which I shall come in a minute.
What right hon. and hon. Gentlemen of the Opposition do not quote is the continuing support I have given from an early stage of the debate to the idea of a State Holding Company. On 10th December 1971, on a Private Member's day, I proposed a motion,
That this House urges Her Majesty's Government to establish a State Holding Company.
I made no proposals for any power of compulsory acquisition. But I did propose that such a State Holding Company should have the power to establish publicly-owned enterprises or to act jointly either with private capital or with nationalised industries to establish new enterprises. I explained the purposes of the State Holding Company in words which, I think I dare claim, anticipated the White Paper "The Regeneration of British Industry". There is no need for a State Holding Company to have powers of compulsory acquisition. Indeed, as I will explain later, in my judgment such a power would be counter-productive.
There is, however, one power of compulsory acquisition in this Bill, a power vested not in the National Enterprise Board but in the Minister, and it is a power subject to the approval of this

House. It exists only in the limited cases covered by Clauses 9–13; that is for the purpose of preventing undesirable foreign acquisitions of existing firms. I believe that such a power is needed and indeed that much of industry will regard such a power as needed. But even here this power is limited by the possibility of a prohibition order which would avoid acquisition by the Government. Therefore the need compulsorily to acquire to prevent foreign takeovers should be exceptional.

Mr. Michael Heseltine: Will the right hon. Gentleman answer the question which the Minister of State, Department of Industry said that he would answer yesterday but then did not answer? Has the National Enterprise Board powers to make aggressive takeover bids for companies?

Mr. Dell: If the hon. Gentleman will wait, I shall be discussing this whole question. I think that he should wait for me to deal with these matters in some order. I am dealing at present with acquisitions by foreign companies of existing British firms.

Mr. David Crouch: Has the right hon. Gentleman left Clause 2? He was touching on that clause before he came to the acquisitions by foreign companies in this country. If I remember rightly, his letter published in The Guardian issued a warning, to which I referred in my speech last night, to his own party and to the Government, about the danger of extending the National Enterprise Board and giving that Board powers to move into the profitable areas of industry, whereas in other countries where such bodies as the NEB already exists such as Sweden, there is no move to enlarge the enterprise boards so that they can move ad lib into the profitable areas. Where does the right hon. Gentleman stand on this matter? Will he give us some constructive thought?

Mr. Dell: The hon. Gentleman has read my letter in The Guardian. I am sorry that I did not hear his speech, nor have I read it. What I opposed in my letter to The Guardian was the compulsory acquisition of large sections of the private sector of British industry to be put under the control of the NEB. I say that there is no power of compulsory acquisition in the Bill.

Mr. Eldon Griffiths: This is an important point. I am sure that the right hon. Gentleman would want to give a clear reply to the House so that there is no confusion in industry on this point. Can the NEB make a resisted bid for a company? Where the company does not want the NEB to buy in, what happens if it resists?

Mr. Dell: As I have just said in answer to the hon. Member for Henley, I propose to come to this point and to deal with it in due order. If hon. Members will wait, I shall give them the opportunity of intervening then.
I was about to refer to the fact that the hon. Member for Surrey, North-West (Mr. Grylls) asked yesterday why a power is needed in this respect, that is, to protect against the take-overs by foreign firms, going beyond the Exchange Control Act. The answer is that there could well be cases where it was thought necessary, particularly in current circumstances, to protect an existing firm against foreign take-over for reasons which did not justify the use of the Exchange Control Act. Moreover, the hon. Member is wrong in thinking this power inconsistent with the encouragement the Chancellor of the Exchequer wishes to give to inward investment. This power protects existing firms. It is not available for use against new investments.
I would make clear, moreover, that these powers do not provide a means by which the Government could interfere in international companies already based in this country, where there is no proposal for change of ownership, nor with the expansion of those activities, nor with foreign companies coming in and setting up new enterprises here.
While I am on the subject of international companies, I should like to say a little more about this. What we expect of international companies with activities in this country is the same degree of attention to the interests of this country and the workers they employ in this country as we would expect from domestically-owned companies, no more and no less. There is no threat to the multinationals in this Bill. Multinational companies have made an important contribution to our economy, just as British investment in many countries abroad has contributed to the development of other economies.
In many cases, as a matter of fact, foreign-owned companies are among the more efficient and have grown faster. This all adds to our national wealth and our standard of living and provides employment. We must recognise and welcome their activities. The present Government are perfectly aware of the harm which could be done to the economy and to the interests of British working people by frightening off these companies. But we are of course, like any other country, entitled to expect responsible behaviour from them, and in the vast majority of cases we have no complaints on that score. I can assure them, in relation to the information powers, that there is no intention to single them out for special attention.

Mr. Tom King: The whole House will welcome the statement about encouragement for inward investment, which is much more responsible, as is the statement about the contribution of multinational companies. But does not the right hon. Gentleman recognise that the real threat lies in the disclosure provisions, and that if confidential processes are being operated by multinational companies and they are thinking of introducing them into this country, they may think twice and put them into another country?

Mr. Dell: If the hon. Gentleman will let me get on, I shall be dealing with the disclosure provisions.
I have said that a power of compulsory acquisition vested in the National Enterprise Board would be counter-productive. The White Paper makes the reason perfectly clear. It says in paragraph 1
We need … a vigorous, alert, responsible and profitable private sector.
Such an objective, a profitable private sector, would certainly be gravely prejudiced if the National Enterprise Board had a power of compulsory acquisition. We expect the National Enterprise Board to act in voluntary co-operation with private sector companies. It is the Government's intention that the National Enterprise Board will act with agreement. I place that on the record and we can certainly discuss whether it should be placed on the record in a more formal manner.

Mr. Heseltine: As the right hon. Gentleman is now absolutely on the point we are discussing, it could be said that if a bid is made for a company's equity on the market and the shareholders agree to accept it, that that is by agreement; but it might be against the agreement of the directors of the company. Will he explain exactly what "agreement" means in the terms in which he is using the word?

Mr. Dell: The hon. Gentleman has exactly identified the point. What he says is right. What I have said is that it is the policy of the Government that the NEB will act with agreement, and we are considering in what form that must be put on the record. I can go no further on that point today.
I take no credit for expressing, as the White Paper does, this need for a profitable private sector. In a mixed economy, the economic success of the Government and the nation depends on the success of the private sector quite as much as it does on the success of the public sector. Any idea that we can substitute for it, that Whitehall can manage British industry, that it can take its investment decisions, its marketing decisions, its research and development decisions, would be an illusion. Nor would I suggest that to the extent to which the private sector has failed to invest, there is anything like a full answer to the problem in the Bill. Our investment record depends on the will of those who work in industry as well as on the general economic climate.
That does not mean there is no value in consultation. It does not mean there is no value in co-operation between the private sector and an agency such as the National Enterprise Board, nor does it mean that co-operation between the two and indeed competition between the two, cannot help to promote investment and development in the British economy.
I know that it is suggested that the NEB may use public money to undermine the private sector by subsidised competition. This is a nightmare without substance. It is the sort of nightmare that was raised when the IRC was founded, when the Industrial Expansion Act was passed, indeed, when the Industry Act 1972 was going through this House. I pay tribute to the skill of Conservative hon. Members with extrava-

gant language. I am never quite sure whether it is the efficiency of the public sector or the subsidised inefficiency of the public sector that is thought to be the more dangerous to the private sector.
The hon. Member for Henley suggested yesterday that the Treasury's powers regarding the National Enterprise Board were ineffective, that we were brought in to deal with a secondary range of minor powers such as those dealing with shipbuilding credit and the NRDC. This criticism is entirely misplaced. The Treasury is given a prominent rôle in determining the financial duties of the board in Clause 5. Moreover, under Schedule 2 Treasury approval is needed before the Secretary of State can lend any sums to the Board from the National Loans Fund, or make any advances from the Consolidated Fund by way of public dividend capital. All this amounts to a major control on the proceedings of the Board. It would prevent, if there were need to prevent, the undermining of private sector firms by subsidised competition.
In any case, one should set the resources at the disposal of the National Enterprise Board against the scale of resources available to the private sector. The £700 million or £1,000 million available to the National Enterprise Board is intended to cover a number of years. These figures are not at all out of line with the financial provision made by the Conservative Government under Sections 7 and 8 of the 1972 Industry Act. These sums are right for their purpose, the purpose of stimulating new investment, new enterprises and joint enterprises with the private sector within the bounds of what is likely to be practicable in such a period.
Certainly there must be criteria for intervention, and the National Enterprise Board must act on a commercial basis, whether its interventions consist of assistance to the private sector under Sections 7 or 8 of the 1972 Industry Act or joint ventures between the NEB and private sector companies, or joint ventures with nationalised industries, or the establishment of wholly publicly-owned enterprises.

Mr. John Roper: Does my right hon. Friend think that the interventions which the NEB is likely to make


are likely to fall foul of the various clauses of the Treaty of Rome or the regulations which the Commission has made?

Mr. Dell: I do not think that they will fall foul. My right hon. Friend the Prime Minister answered a question like that today. There are rules, but if there were not this country would be in danger of competition within the Community from countries richer than ours. They would be able to give better subsidies than we can afford. There were rules within the European Free Trade Area. The only way in which we could avoid rules of this sort in these days would be by shutting ourselves in a fortress.
Profitability and the return on capital, measured in financial terms, remain the best prima facie indication of a company's efficiency in using resources and meeting its customers' needs. If we are to achieve the overriding objective of improving our industrial performance, resources need to be directed wherever possible to companies which have the soundest performance and the best prospects as regards viability and the rate of return, or where there are outstanding opportunities of improving performance. It may be argued that such companies will in any case command the necessary resources without the benefit of the National Enterprise Board. But there can be shortages of management, as well as of money on the right terms, and the National Enterprise Board can help to direct management as well as money. This was certainly one of the better achievements of the Industrial Reorganisation Corporation.
The hon. Member for Henley said yesterday that the Government's policy of highly selective investment in industry will mean that the weakest will come to collect the cash and the strongest will be gradually debilitated. There is certainly always a danger that Government money will go to the weakest, and that has certainly been a large part of our experience of industrial policy in recent years. Indeed, I criticised the Industry Bill of 1972 on the grounds that there was little in it to protect the public against precisely that kind of danger.
It is precisely for that reason that in my judgment if intervention is to be financed by public money it should be

through the instrumentality of an agency such as the National Enterprise Board, upon which obligations can be placed and which will be responsible for its results.

Mr. Heseltine: Is the Minister aware that the Industrial Development Advisory Board was set up to protect the public in just the way that he has pointed out—a Board that has been ignored five times by the present Secretary of State for Industry?

Mr. Dell: The Secretary of State is entitled under the Act to ignore the advice of the Industrial Development Advisory Board. I will come to other aspects of the Act in a moment, but I remind the hon. Gentleman that the board was considered so important by the previous Conservative Government that they did not even include a mention of it in the original draft that was presented to the House.
I was going on to say that if there are to be subsidies to particular companies to protect them from collapse for social reasons—and all Government act in that way—the subsidies should be overt and the Government should provide the money for them directly. The National Enterprise Board is to be required under this Bill to run a commercial operation. So it is equally right that where the National Enterprise Board acts on behalf of the Secretary of State in a social rather than a commercial context, that fact must be clear and clearly defended on its own merits.
In summary the position is that the Secretary of State, with the consent of the Treasury, will determine the financial duties of the Board, which will result in an adequate return on the capital employed by the Board. We would envisage that there will be a minimum rate of return, at any rate so far as the Board's wholly-owned subsidiaries are concerned.
The Bill will allow different financial duties to be determined in relation to different assets and activities. But as the White Paper makes clear, where the Government require the NEB to depart from its commercial objectives on social grounds, and the Government are subsidising the NEB, these subsidies will be accounted for separately. This enables the Government to make use of the


expertise and knowledge which the NEB will have. It certainly does not imply that the money provided to the National Enterprise Board to prosecute its commercial functions will be used on any other basis than that the NEB must back success and the prospect of success. We are, after all, discussing very largely not the question whether there should be intervention by Government but how it should be conducted.
Whatever was the case at the time of Selsdon it is now accepted between the principal parties that the Government need a power to intervene and a capacity to intervene in industry. The right hon. Lady the Leader of the Opposition, was quoted in the Daily Telegraph of 14th February as saying to the 1922 Committee:
If an industry got into difficulty you might have to help it out. But you would do so by making that industry fit and healthy again, so that it could tackle its own problems. This would be intervention on a temporary basis—quite a different form of intervention from going in to take it over.
Whether it is permanent intervention or temporary intervention, it is still intervention. We can say of the right hon. Lady that she starts well this side of Selsdon. I would simply issue the warning that if one starts on a course of intervention it is not always so easy to put a limit to it. If large amounts of public money are invested in private companies it is not satisfactory that the future of those enterprises should be left simply to private management. The Government are responsible for that money. One needs strict criteria and control. One needs the right instruments.
But there is another reason for a Government needing the power and capacity to intervene going beyond the need from time to time to help weak industries. Again, it was a reason accepted after its Selsdon period by the former Conservative Government. It is because Government, with the economic record of this country since the war, cannot limit themselves simply to incentives or to macro-economic influences to encourage investment by British industry.
Nor did the right hon. Gentleman for Sidcup (Mr. Heath) find his other stimulus to investment—namely, dinners with businessmen at Chequers—a particularly effective method. The economic record of this

country since the war has not been magnificent. The fact that it has not been magnificent provokes questions. Are there ways in which we could do better? How could it be otherwise than that such questions should be asked? These questions are not to be answered by a confrontation of established ideologies.
Practical experience shows that among the most damaging features of British economic policy since the war has been the uncertainty it has engendered. Industry has been compelled to ask itself in any period of growth how much trust it could put in its duration. Every investment decision has been made more risky by such uncertainties. It also seems sensible that there should be discussion between Government and industry to see whether there are ways in which Government can help to reduce the special risks attached to investment decisions in a slow-growing economy. Thus correct demand management policy is the principal instrument in the hands of Government.

Dr. John A. Cunningham: Is thais not the most crucial argument in terms of regional policy? Will my right hon. Friend make it clear that the powers which the Government are about to take and which many of us support are not intended to be used piecemeal, or in an arbitrary fashion, or as a short-term expedient, but are intended to be used strategically? If not, the regeneration of British industry that we seek will not result.

Mr. Dell: That is certainly the intention. I understand that my hon. Friend the Minister of State, Department of Industry, will deal later with the subject of regional employment.
Incentives have also been used and they have their value. The Government already help with investment incentives. By international standards our investment incentives are very substantial. What industry and the country want above all is steady growth. Governments which have failed to ensure steady growth have provided large investment incentives instead as a very poor second best.
The present Government have left the investment incentives inherited from the previous Government unaltered—first, because we do not want to make another change in the system for what could


only be marginal benefits but, secondly and primarily, because no one can expect industry—after its experience since the war—to rely in its investment decisions on the prospect of steady growth simply because the Government say that that is their objective. It will take many years of happier experience before such a trend will be regarded as reliably established. I regard investment incentives as simply an inevitable ingredient in a slow-growth economy.
In addition, I have always placed great emphasis on the rôle of competition policy. But something more is also needed—namely, a direct power to stimulate investment and development, particularly perhaps counter-cyclical investment and development. This will not bring many benefits in the short term.
It would be entirely wrong to overestimate what an instrument such as the National Enterprise Board, or indeed any other form of direct Government intervention, can achieve to deal with the problems we face in the coming months. But it is an essential supplement to other policies. It will be immediately useful to help with particular industrial problems that are bound to arise.
There is, of course, a legitimate point of disagreement between the political parties about the instrument through which intervention should be conducted. Should the intervention be by the Government directly, or by a Government agency such as the National Enterprise Board? Successive Labour Governments have believed that there should be a Government agency. I have shared that view because I am sceptical of the capacity of Whitehall to act effectively in this field, because there is a need for a continuing responsibility and surveillance over such interventions in industry which Whitehall and Ministers cannot easily exercise—and which, on the record, they have inadequately exercised. I believe that a Government agency can act more independently, more vigorously, more rapidly. It can be staffed for the purpose. Like the IRC, it can redeploy capable managers. In my judgment, an agency represents the better technique.

Dr. Jeremy Bray: I follow the argument about the relative rôles of the agency

and of the Government, but will my right hon. Friend confirm that he sees the power in the Bill as intended to be used systematically to make a measurable impact on the economy as a whole and not merely in what he once described as "case work" of a kind which can be left to an agency?

Mr. Dell: I accept that the agency will be used in a systematic way. If my hon. Friend will refer again to the excellent book to which he referred, he will see that I was making a distinction in the book between the Government's social intervention and other kinds of intervention.
However, the Government of the right hon. Member for Sidcup, instead of setting up a Government agency, established in 1972 an industrial development executive within the then Department of Trade and Industry. They said that they had chosen that method because of the importance of Ministerial responsibility. There may be a difference of judgment as to the most effective location for an activity of this kind. It is hardly a question of principle. Indeed, as we know, that Government carefully considered the desirability of acting through an agency outside Government before concluding in favour of the Industrial Development Executive. That is quite clear from the discussions that were going on in this House at the time. In the end, they decided to reject the idea of an agency; but I have always suspected that it was not so much on what they judged to be the merits of the argument as because they did not wish to appear simply to be reviving the Industrial Reorganisation Corporation which they had abolished the year before.
The fact that this Government have decided to establish an agency for this purpose hardly justifies the scaremongering of hon. and right hon. Gentlemen opposite. I know that the hon. Gentleman the Member for Henley said that there were four safeguards in the 1972 Act which are to be repealed. The right hon. Member for Knutsford (Mr. Davies), who was responsible for that Act, made the same point yesterday. The hon. Member for Henley made this point in a letter sent to the chairmen of Britain's thousand largest companies outlining the


initial reaction of the Conservative Party to the Industry Bill.
The safeguards to which he was referring are as follows—and I quote from his letter as printed in a Conservative Central Office handout of the 13th February:

"1. The limiting of Government powers of purchasing shares only to those cases where no reasonable alternative form of finance exists.
2. The requirement that shares taken should be disposed of as soon as practicable.
3. The limitation of a percentage of a company's equity that the State may take in companies outside the assisted areas to 50 per cent.
4. The date—31st December 1977—after which the Government would no longer have powers to take equity outside assisted areas."

It is worth examining these four safeguards on which the hon. Gentleman so much relies and whose disappearance he so much regrets.
Let us take the first, which he describes as the limit placed on Government powers of purchasing shares only to those cases where no reasonable alternative form of finance exists. This limitation on the right to acquire shares was regarded by the previous Conservative Government as so important that it did not appear in the original draft given to this House of Clause 8 of the 1972 Industry Bill. There has, of course, never been a comparable restriction to Section 7 of the 1972 Industry Act. This restriction was al ways a nonsense—a nonsense impeding Government action quite unnecessarily. It is largely no doubt because of this provision that Section 8 of the 1972 Industry Act has been of so little value. Nor is it needed for the protection of companies.
So far as the NEB is concerned, the real protection for companies lies in the fact, first, that their relations with the National Enterprise Board will be entirely voluntary; secondly, that any National Enterprise Board intervention will be by agreement, and, above all in the fact, that if the company can get money elsewhere, it is at liberty to do so—including, incidentally, private sector money through Finance For Industry. These are the real safeguards and not this entirely self-defeating provision that was installed into the Industry Act at the last minute under pressure from the then Government's supporters.
The second safeguard is the requirement that shares taken should be disposed of as soon as practicable. Once again this safeguard in Section 8(iv) of the Industry Act was regarded by the previous Government as so important that it did not appear in the original Industry Bill of 1972. Again, it was always a nonsense. It is important that the National Enterprise Board should have a continuing responsibility for the success of its investments and not least for those which it undertakes under Clause 8. It would be entirely wrong to compel it to get out as soon as "reasonably practical" as it would be required to do—or as the then Government required itself to do under pressure from back benchers.

Mr. Viggers: Does the same point apply to Clause 7(5) as to Clause 8(4)?

Mr. Cyril Smith: I wish to ask, Mr. Deputy Speaker, for protection from the Chair for back benchers in this debate. The fact is that the Minister has now been speaking for 35 minutes. This is the second day of the debate on this Bill. The Bill was introduced by a senior Minister yesterday. Yesterday, at the opening of the debate, Mr. Speaker appealed to back benchers to cut their speeches short and said that over 20 hon. Members wished to take part in the debate. We are now listening to another Front Bench speech and there is to be an Opposition Front Bench contribution before back benchers will have the opportunity to contribute. Will you, Mr. Deputy Speaker, make a plea to the two Front Benches similar to that which Mr. Speaker made to back benchers yesterday?

Mr. Deputy Speaker (Mr. George Thomas): Once an hon. or right hon. Member is called, the length of time he takes is up to him. Those hon. Members who spoke yesterday might exercise the self-discipline of not making interruptions today, thus saving the time of other hon. Members.

Mr. Dell: I apologise to the House. The House will realise that I have taken this length of time because I have given way to every hon. Member who wished to intervene. I therefore take it as the wish of the House that I should give way no further.
I shall look up the clauses, as requested by the hon. Member for Gosport, and give him an answer.
The third safeguard is the limitation of the percentage of a company's equity that the State may take in companies outside the assisted areas to 50 per cent. Again this safeguard was thought by the previous Government to be so important, so vital a part of its industrial legislation, that it did not appear in the original 1972 Industry Bill. Once more it was always a nonsense. Why should there be a difference between assisted areas, where there is no limit on the right to acquire shares, and non-assisted areas? Does anyone imagine that the Government or the National Enterprise Board cannot control a company for most purposes with 50 per cent. of its equity? The real safeguard is that the National Enterprise Board has no power of compulsory acquisition of a company's equity.
The final safeguard is the 1977 limitation on the powers to take equity outside assisted areas. This one, unlike all the others, was in the original 1972 Industry Bill. Although in that respect it is different from these other supposed safeguards it shares with them the fact that it was always nonsense. There is no evidence at all that need for this type of assistance will cease in 1977. Indeed if the right hon. Member for Finchley (Mrs. Thatcher) is to have the opportunity of discharging the duty, which she sees, of occasionally assisting weak industries, I am afraid she will acquire this power only long, long after 1977.
I come to the provisions regarding the disclosure of information on Clauses 20 to 24 of the Bill. These clauses have caused great, though perhaps exaggerated, anxiety. It is important to improve the level of disclosure in British industry and to ensure that employees are properly informed about their companies' plans and prospects. It is entirely wrong that, as has happened again and again, large, sudden redundancies should throw thousands of people into unemployment. There can therefore be no doubt about the need to improve the flow of information in British industry.
There is equally a need to improve the flow of information from British industry

to the Government and indeed vice versa. I hope that large companies when invited to enter into Planning Agreements will be alert to the demands which they can put on Government and just not those that the Government are seeking to put on them. Indeed I am surprised at the inferiority complex that so rapidly seizes so many British companies when they read a piece of legislation such as this. In my experience of the relations between Government and industry, companies are at least as well equipped to look after their own interests as are Government Departments to look after the public interest.
However, those powers have caused anxiety and worry as to how they might be used. Provided the principles of greater information disclosure is maintained, we are ready to listen to and consider constructive criticism and alternative proposals for safeguarding information of vital importance to a firm.
Yesterday the hon. Member for Henley referred to the failure of the political system in this country to create a partnership between Government and industry of the kind that had been created in other countries. He is absolutely right and he will also note that the other countries to which he refers do not suffer from the obsession for or against public ownership which exists in this country, nor is there the continual battle about public ownership or about the need for agencies such as the National Enterprise Board. Those countries extend public ownership when, on pragmatic grounds, they think it right. They even introduce agencies of this kind when, again on pragmatic grounds, they think it right. It does not cause uproar, nor does it lead shadow industry spokesment to circulate tendentious letters in hundreds of copies protesting against the activities of a Government who wish precisely to create the type of partnership with industry which has helped towards economic success in other countries.
It is not so much a failure in our political system but a long tradition that the public sector and the private sector must not meet or mix, or, if they do, only with a mutual sense of incorruptible distrust for one another. It is this distrust which must be overcome. On the one hand, there is the slanging of industry by Governments that seek in industrial failure an excuse for their own mistakes,


and, on the other hand, there is the rejection of Government intervention, except in extremis, on the ground that such intervention, especially if it comes from a Labour Government, must be motivated by greed, envy and, what is even worse, ideology.
In building a new partnership it is essential that the Government should not over-emphasise the short-term benefits of action such as the creation of a National Enterprise Board. It is an instrument with a long-term potential. It cannot bring miraculous short-term solutions.
Nevertheless the creation of the National Enterprise Board is a valuable and constructive initiative. The fears of industry will decline and disappear in exactly the same way as they did in the case of the Industrial Reorganisation Corporation and, indeed, the Industrial Expansion Act.
I come back to the perceptive words of the Bolton Committee in its Report on Small Companies. It said:
There appears to be a tendency to mistrust initiatives of a Labour Government on principle and irrespective of their merits.
It will, however, in due course be found and accepted in industry that the National Enterprise Board is, in fact, a useful instrument of partnership with industry. To conduct the battle today in the extreme terminology of Selsdon, as the Opposition evidently intend to do, even though they now claim to have rejected Selsdon, is in my judgment both a crime and a blunder.

4.57 p.m.

Mr. Eldon Griffiths: In congratulating the right hon. Gentleman on the time he took for the splendid illustration of the new doctrine of divided Cabinet responsibility, perhaps I should describe it as a case of the Treasury hand on the dog collar. Today we heard the Treasury speech, which was careful and orthodox, with several deep bows in the direction of the private sector which are much appreciated, and a clear recognition of the need to safeguard public money. I am very glad that the right hon. Gentleman made that speech. I am sure that what he said will go some way at least to relieving the worst fears of industry.
The Paymaster-General will not have failed to notice that the Secretary of State for Industry left the Chamber in the middle of his speech.

The Minister of State, Department of Industry (Mr. Eric S. Heffer): rose—

Mr. Griffiths: I have no doubt that the Secretary of State for Industry had reason to leave. I accept that. However, I believe that his departure was symbolic, as indeed is the absence for the most part of the Tribune group, who sit on the benches below the Gangway.

Mr. Heffer: On a point of order, Mr. Deputy Speaker. My right hon. Friend had to leave to attend a Cabinet committee meeting. There was no other reason why he left. He left his apologies to the Paymaster-General for having left in the middle of his speech.

Mr. Deputy Speaker: I hope that honour is satisfied on both sides and that we shall continue.

Mr. Griffiths: I continue to note that the Secretary of State has left for more important business. I make no complaint. I insist that I find it symbolic that the empty Tribune benches and the departure of the Secretary of State underline the essential division within the Labour Party on this important Bill. If the Paymaster-General, whose contribution I admired, had been in the House yesterday he would have heard the speech from the Department of Industry, all the red blood and thunder about the failures and the selfishness of private enterprise and all the language that we were given about the opening up of a new era of worker control.
Which Minister is speaking for the Government? Which twin has the Toni? I believe that we are being treated to the evidence of a Government with a Left wing which regards the National Enterprise Board as a mechanism for Socialism and another portion of which is horrified in our present economic circumstances by the possible consequences of what the Secretary of State for Industry is now doing to industry. No doubt when the Minister of State replies this evening we shall hear the red-blooded side of the argument.
However, I hope that the Paymaster-General will answer two questions that arose from the debate he missed yesterday. I refer him to the speech made by his hon. Friend the Member for Luton, West (Mr. Sedgemore), who is not in his place today, in which he said:
It is a Bill which will pave the way to a new industrial revolution—a revolution which will change the face of British industry and the social structure of the United Kingdom.…. It is a Bill which will end the single-minded ethos of the joint stock company … end the managerial society … transform and transfer industrial economics and ultimately social power in Britain."—[Official Report, 17th February 1975; Vol. 886, c. 1017.]
For the benefit of people engaged in joint stock companies, will the right hon. Gentleman tell us whether the Government do or do not want to put an end to them, as the hon. Member for Luton, West said? For the benefit of industrial managers, may we know whether the Government want to end the managerial society? I hope that the right hon. Gentleman will give the answers to those questions. Perhaps he will do so now.

Mr. Dell: The hon. Gentleman is well aware that I dealt with those points in my speech, which was apparently too long for the hon. Member for Rochdale (Mr. Smith). The Government are not responsible for speeches made by backbench Members on either side of the House. Hon Members may express themselves here in any way they wish. I stand by what I said.

Mr. Griffiths: I am glad that the right hon. Gentleman stands by what he said, but I am sure he could not stand by what his right hon. Friend said.
I turn now to what I believe is some common ground. The common ground must start with the fact that this country faces a national economic crisis. Inflation is very nearly out of control, despite the fact that we are no longer importing it. Wage increases in the public sector are now well over 25 per cent. compared with the 6½ per cent. on which the German trade unions settled in the last few days. Prices are rocketing upwards. The electricity bill for the average householder is up from just over £40 to £55 a year. Food, even with subsidies, is set to rise by an extra 20p to 40p a week. Rates are up by almost one-quarter in most parts of the country and

in some areas by one-third. The cost of motoring, not only petrol—that is easy—but repairs, insurance and tyres, is 29 per cent. up on a year ago. And so the spiral goes on.
Meanwhile, as a Treasury Minister would be the first to recognise, Government borrowing is swelling to proportions which cast doubt upon the Chancellor's ability to finance it. The pound is propped up by the Arabs, whose money is kept in London far more by the skill and trustworthiness of the City of London than by the Secretary of State for Industry, who constantly derides the City's great contribution to our national accounts. All the time the crisis deepens, and with it unemployment.
I should like to ask another question to which I hope to get an answer. Mr. Jack Jones, speaking on behalf of the Transport and General Workers' Union late last week, said:
there is an immediate need for a special and huge jobs rescue plan in industry. The only way to start the rescue is for the Government to tell the State industries to … take on more people. The Government has really direct power in the State sector industries and it must use it now . . to stop the growing threat of a million people out of work".
Does the right hon. Gentleman, like the Secretary of State for Industry, regard the National Enterprise Board as a mechanism for coercing industries to take on more people to meet Mr. Jack Jones' point? The Secretary of State certainly implied that and has gone round the country bamboozling workers into believing that the NEB is the answer to unemployment.
The miners' settlement, soon to be followed by other settlements with the railways and the power stations, is already causing some members of the Cabinet to think the unthinkable—that a statutory freeze of some kind may soon be inevitable.
There is talk of an import surcharge, In the meantime industrial production is falling sharply. Treasury Ministers, including the Chancellor to do him justice, have now hoisted the danger signals. The Chancellor told us that we may well be heading for "national bankruptcy". No longer does he tell us that inflation is slowing down.
Therefore the question, as we come to the Bill, is what we should do to overcome this crisis before it overcomes us. I do not pretend for a moment that the Opposition have all the answers, but of one thing I am certain. Faced with so grave a crisis, which sooner or later could spill over into social unrest and episodic violence, the last things that Britain can now afford are an increase in non-productive public expenditure and the disruption of industry by the Government. Yet that is precisely what the Secretary of State for Industry apparently has in store. At a time when his colleagues are having to cut down on roads, schools and hospitals and to abandon the Channel Tunnel and the expanded nuclear power programme that the country needs, the Secretary of State for Industry proposes to splurge hundreds of millions of pounds simply to switch the ownership of large sectors of British industry from one set of hands to another.
I can think of nothing more irrelevant to our economic problems at this time than the proposal to spend £100 million or more on switching the aircraft industry from one set of hands to another and £40 million or £50 million—we do not know the figure—on switching the shipbuilding industry from one set of hands to another.
The Secretary of State told us that the Bill will bring in a new era. The right hon. Gentleman built his speech, as he built his whole campaign, on three main themes: first, the need for investment; secondly, the belief that the State can do a better job than private enterprise, which he quite falsely said had failed; and, thirdly, industrial democracy. I want to say a few words about each of those themes.

Mr. Ted Leadbitter: Before the hon. Gentleman utters those few words, may I ask whether, in view of his comment about my right hon. Friend leaving the Chamber, he has noticed that his hon. Friend the Member for Henley (Mr. Heseltine) has just left?

Mr. Griffiths: The essential difference is that my hon. Friend and I happen to agree.
I believe that is is common ground between us that British industry, public as well as private, does not invest and has

not invested enough. I hope that it is also common ground that much of our investment, more perhaps in the public than in the private sector, has been misdirected or has produced far too low a return on capital. The questions which divide us are why this has happened and how best our investment can be not only increased by rendered more effective.
We believe that the best and, in the long run, the only sustainable source of income for British industry is profits. This applies both to the public and the private sector. When profits are healthy, investment starts to grow, though there is always a lead time. When any industry is starved of reasonable profits, investment, again after a period of lag, rapidly starts to decline. The record of recent years bears this out completely, and in view of yesterday's debate I should make the record quite straight. Under the last Labour Government, as my right hon. Friend the Member for Knutsford (Mr. Davies) said, the profits of British companies declined disastrously. In 1968 there was a 33⅓ per cent. fall from the profits of 1967, in 1969 a further 12 per cent. fall in profits compared with 1968, and in 1970 there was a 16 per cent. fall from 1969.

Dr. Bray: What happened to investment?

Mr. Griffiths: I am coming to investment. Here is the reason, when Labour left office, that the investment intentions of the British industry had fallen to a very low ebb. They went on falling into 1971 and 1972.

Dr. Bray: What about actual investment?

Mr. Griffiths: I shall deal with that. Profits honestly earned after 1970 once again started to rise, as production increased and confidence was gradually restored. Thus in 1971, adjusted profits were 12 per cent. up, and in 1972 they were up again by 12 per cent. In 1973, the year when the increased prices of oil and of other raw materials hit industry, profits rose only by just over 1 per cent. The pattern is clear—under the Labour years the consistent and disastrous falls in profit, and with them, the investment intentions, and under the Conservatives the substantial increase in profits and the return of investment to industry.
I will tell hon. Gentlemen how industry responded. There is a lag time, a long lead time, requiring the purchase of equipment, buildings, plant and so on. In the CBI survey of more than 1,000 firms there is shown unmistakeably that in the last six months of 1971 investment intentions rose by just under 20 per cent. In 1972 they went up a further 20 per cent. In the first 10 months of 1973, before the fuel crisis, they went up by a further 18 per cent. I think there is absolutely clear evidence here that when industy is profitable it invests and when it is starved of profits it does not invest. Hon. Members talk about the private and public sectors, but it makes no difference. If industry is allowed to make profits, it will invest. If it is not allowed to make profits it will not invest. It cannot.
Since investment lies at the heart of this Bill, I think we must see what the present Government have been doing to encourage industry to invest. The Chancellor of the Exchequer banged up corporation tax and advance corporation tax. He very much raised national insurance contributions and extended price control so that industry was unable to pass on the full effects. Local authorities, with Government encouragement, banged up industry's rates bill as much as 30 per cent. in 1974, with more to come this year.
Meanwhile, inflation not only in the price of fuel and raw materials but increasingly in the explosion of real wage costs to industry, is driving company after company to the wall—so much so that the number of bankruptcies has risen from 882 in the third quarter of last year to 1,355 bankruptcies in the third quarter of the 1974–75 year. Hon. Members will realise that the bankruptcies of individual private firms means the joblessness of thousands of men who work in them.
All these were body blows to industrial investment. It is, therefore, no surprise at all that the Bank of England, in its Quarterly Bulletin of last December, estimates that in the first quarter of 1974 industrial and commercial firms made no real profits at all. Rather, they suffered a financial deficit of £740 million. That is a measure of the stewardship of the present Government of British industry.

One cannot expect investment out of a negative cash flow.

The Under-Secretary of State for Industry (Mr. Michael Meacher): If the hon. Gentleman thinks that the relationship between profitability and investment is the key factor, how does he explain that profits successively rose considerably in the first three years under the last Conservative Government and yet when they went out of office investment was 10 per cent. below, in real terms, what it was when they came in?

Mr. Griffiths: The hon. Gentleman will forgive me if I do not follow him along that road. He spoke last night. He does not understand the rôle of confidence in investment, and so long as he stays in office, I doubt very much whether confidence will return.
The only recourse for industrial firms if they do not generate the profits with which to supply their investments is to turn to the banks. But they are caught up by the sky-high interest rates which reflect the Chancellor's need to pay over the odds to keep Arab money in Britain.
On the subject of investment, industry has been treated abominably by the present Government. It is, therefore, no wonder that the latest survey shows that 41 per cent. of firms expect to invest less in the next 12 months, that 31 per cent. are less optimistic about exports, that 61 per cent. are working below capacity and 34 per cent. believe that they will be forced to shed labour. We have indeed a crisis.
Against that background, where industry's profits have been destroyed by excessive taxation and runaway inflation, it is an impertinence for the Secretary of State to go around complaining that industry has failed to invest. He and his right hon. Friends have shattered confidence. They have made investment impossible. Their attitude is like that of the mediaeval apothecary who first bled his patient white and then wondered why his patient was anaemic. There is, of course, a less charitable explanation. I would not for one moment level it at the right hon. Gentleman.

Mr. Michael Mates: Go on!

Mr. Griffiths: It is that the Secretary of State for Industry, far from being unhappy about this fall in investment, is quite satisfied to see private industry being driven to the wall because he welcomes the sight of great British firms being pushed near to bankruptcy and forced against their wishes to look to him—their tormentor and soon their executioner—for help. I do not wish to do the right hon. Gentleman an injustice, but I must tell him that a large number of people who are just as dedicated to the success of British industry as he is, and who have a good deal more experience, are convinced that in his private thoughts he rejoices at the sight of his colleagues' measures and his own threats bringing great private firms to their knees because he knows that only in this way can he possibly justify his plans to take them over.
The Conservative Party opposes this Bill absolutely, and we shall, as soon as circumstances permit, get rid of it. We oppose it because it stands not by itself but is one of a whole series of measures designed to impose State Socialism on the country. It is not by itself. On top of it there are the measures for all-out nationalisation. Beyond coal, gas, electricity, railways, waterways, airlines, the National Freight Corporation and steel, Labour is now proposing to nationalise shipbuilding, ship repairing, marine engineering, airframes, aero engines, aerospace, the remaining free enterprise ports and effectively building land.
Nor is this the end of it. The Labour Party Manifesto says:
We shall take over profitable sections of individual firms including sections of pharmaceuticals, road haulage, construction and machine tools in addition to our proposals for North Sea and Celtic Sea oil and gas.
If the Government do what they say, it means that the great bulk of our productive capacity, one way or the other, will be in the hands of the State and that, taking account of those employed in central and local government, well over half of the working population of Britain will be employees of the State. They will not have much chance to change their employer then.
In addition, there are the financial measures, capital transfer tax, penal taxes on company profits, higher income tax and surtax—and no doubt we shall see

more of those in the Budget—the forthcoming wealth tax and the ever-higher charges for national insurance and rates. Taken together these will mean—indeed they already do mean—that the State, one way or another, takes away from the citizens a far larger share of the gross national income than it does in any of our main industrial competitors in the free countries of the world.
Next, the Government, in the name of industrial democracy, propose to hand over more and more of the day-to-day power in British industry and commerce to one section of the community—the leaders of the trade unions. The Government have already put through the closed shop legislation. In this Bill they seek to create a new, privileged class through the disclosure arrangements that give to union officials, and union officials only, privileges that will be denied to shareholders, consumers or even to this House.
Before long, or so we are promised, Ministers propose to impose 50 per cent. trade union membership on the boards of companies, irrespective of whether the workers in the companies have joined a union.
Taken together, all these measures give the lie to what the right hon. Gentleman has sought to tell the House this afternoon. We can live with him and his reasonable attitudes, but these measures add up to the most concentrated, most destructive and most class-conscious attack on what remains of private enterprise and individual capital and property ownership that we have seen in this country. They make a nonsense of the Chancellor's protestations that he wants a healthy and vigorous private sector. They give the lie to the Prime Minister's claim that, in the interests of confidence, he wants what he called a stable frontier between the private and public sectors.
I give credit where it is due. The Tribune group has never concealed its desire to see the private enterprise mixed economy destroyed. They are honest men. Who can say that of the Government? The Chancellor of the Exchequer hands out reassurances about private capitalism behind a haze of cigar smoke at the Guildhall while the Chancellor of the Duchy of Lancaster does the same in Wall Street. They both tell the City not to worry about the Secretary of State for Industry—"Harold has him


tamed", they say. The Prime Minister even tells the nation that the Secretary of State is not to be master in his own house, that all the powers given to him are only window-dressing, while the real power to clip his wings remains in the Treasury. I hope that that is so.
I was interested to note that all these soothing noises and especially the cosy chat which the Prime Minister is said to have had with the CBI at No. 10, have alarmed the hon. Member for Bethnal Green and Bow (Mr. Mikardo). He made that plain yesterday. They have certainly not assisted the Secretary of State for Industry, although he would be the first to recognise that he does not inspire the same loyalty from his Cabinet colleagues as he does from the Left of his party. In my view the hon. Member for Bethnal Green and Bow and the Tribune group need not worry. They are winning hands down, perhaps not as quickly as they would like but steadily and inexorably.
The Labour Party is moving towards all-out Socialism, snuffing out private enterprise in industry after industry, confiscating private property, taxing away personal capital, restricting consumer choice and concentrating economic, financial and political power into fewer and fewer hands. It is doing this on the basis of no clear electoral mandate.
I turn to the question of consent. The Secretary of State told us yesterday that he is winning consent for his measures. He was apparently reported in Monday morning's papers as saying that he finds growing support for his Bill among management. It appears that managers of British industry do not read it in quite that way.
The Association of British Chambers of Commerce issued a statement following the Secretary of State's remarks. They said:
we are most puzzled by the claim … by the Secretary of State for Industry … that there is growing support for the Industry Bill among the ranks of management. The Bill and its preceding White Paper have been under steady scrutiny in Chambers of Commerce for months. Yet in all that time we have not been made aware of any measure of support from management. All that our efforts have revealed are a growing number of inherent snags, and a growing awareness of the irrelevance of the measure to the real economic problems facing us.

The right hon. Gentleman will know that this association is hardly the voice of privilege. It represents 50,000 British companies, both large and small, industrial and commercial and in every region of Britain. It is easily the largest representative group of its kind in the country and its most active participants are drawn from just the levels of middle management which the Secretary of State quite wrongly claims to be supporting this Bill. The association concludes the statement with these words:
One thing we are aware of … has been the assiduous effort of certain members of the Government to visit individual Chambers and meet their members. On occasion such talks have been followed by an unfounded ministerial claim that Government ideas were received sympathetically. We were simply being polite.
That is the comment of the managers of British industry. It underlines the self-deluding capability of the Secretary of State. He has an extraordinary ability, together with his hon. Friends, to turn up at trade union meetings, get a large round of applause and then go away convinced that he has carried the nation.
I thought that the late Dick Crossman put it very well when, in an article published this week in The Sunday Times, he said:
I like Tony Benn a great deal and I had every hope of him when Harold appointed him Postmaster-General. It's a queer thing but I am not very happy about him now I see him at work.
To begin with, on every single occasion when he is about to bring a plan to Cabinet a leak occurs giving the full details in advance.
How is industry to treat the confidentiality of the Secretary of State on the Planning Agreements if that is the way he handles his Cabinet papers? Mr. Crossman continued:
In the second place, there is an odd hardness about him … he has at times a kind of mechanical Nonconformist self-righteousness about him which seems to come out even more strongly in office.
I hope that the Under-Secretary will tell his master that his self-deceiving ability has made him, as the right hon. Member for Knutsford (Mr. Davies) said, the scourge and not the friend of industry.
During the debate yesterday my hon. Friend the Member for Henley (Mr. Heseltine) was asked whether he would attempt to set out the ways in which a Conservative Government would handle


this mater differently. That is a fair question and in the spirit of the right hon. Gentleman's speech. I would like to conclude with a few remarks on that point.
We shall resist by every constitutional means open to us this onslaught on private enterprise and on the freedom of the individual to own and manage capital in a competitive and responsible fashion.
We shall resist it for the following reasons: first, because it involves the squandering and waste of public money. We cannot afford to spend hundreds of millions of pounds to satisfy the Secretary of State's taste for industrial experimentation. Secondly, we shall resist it because it would dislocate industry and distract the attention of managements and workers at a time when every effort needs to be devoted to increasing output, to holding down costs and to expanding overseas sales.
Thirdly, we shall oppose it because much of it is a phoney. The National Enterprise Board in reality is a licensed State take-over board, and the Secretary of State's regeneration will turn out to be the degeneration of British industry, just as his industrial democracy is no more than a fancy label for a shop steward's oligarchy.
We shall oppose the Bill because, in principle, along with other actions of the Government, it lays an axe at the roots of industrial efficiency. The Conservative Party is as keen as any hon. Gentleman opposite on worker participation and the disclosure of information by private companies, but the ham-handed manner and the excessive pernickety detail which the right hon. Gentleman has instructed his parliamentary draftsmen to inflict on the day-to-day management of complex businesses reveals that total but dangerous innocence on his part that makes industry despair of Government intervention.
Above all, we shall oppose the Bill—and, indeed, the right hon. Gentleman's whole bag of tricks—because it strikes at the heart of the free, responsible and capital-owning society which we believe the large majority of the British people instinctively prefer to the rigid collectivist system which the Labour Party seeks to impose.
Private enterprise—and it is fair that I state this plainly so that Labour Members can disagree if they will—is to us by far the most effective method of harnessing the energy and ambitions of the individual for increasing the wealth of the nation, for pioneering new projects and technology, for holding down prices through the mechanism of competition and, above all, for widening the range of choice of goods, services and jobs.
To us, capital ownership is the outward and visible sign of something quite basic in the spirit of man, that is the desire to have and to hold what human beings earn for themselves, and it expresses a man's reasonable desire to pass on to his children some fruits of his own labour.
More important is the matter of freedom. At a time when the individual citizen finds himself hemmed in by big Government, big media and big unions, the wider the spread of capital ownership, the more secure his personal liberty. Where the State owns and manages everything, no one save the bureaucrat has any real freedom of choice. It is only where large numbers of citizens—preferably the large majority—themselves own and manage substantial portions of society and are protected by law from the arbitrary usurpation of their property rights that the individual can maintain, with any hope of success his independence, his personal privacy, his ability to change his employer or his basic right to disagree with those who govern him.

5.34 p.m.

Mr. Roger Stott: I did not interrupt the hon. Member for Bury St. Edmunds (Mr. Griffiths) because I am conscious of the time, but I hope to take him up on some of the spurious arguments that he has just deployed.
I have sat in this Chamber all today and yesterday listening to Conservative Members deploying their arguments, and it seems to me that we have been witnessing something similar to a group of surgeons looking at a sick patient and each surgeon coming up with a different answer on how to make him well.
Those of us who have worked in industry all our lives and have had the good fortune recently to enter this House have for many years had our own ideas of why British industry is in its present decline. We have seen a growing


malignancy in British industry, a malignancy which in some cases has become terminal. Industries as diverse as aerospace and washing machines have been floundering in a sea of incompetence, uncertainty and inefficiency.
Year after year we have witnessed industry, both big and small, coming to the Department of Industry to seek Government assistance of one kind or another. This has happened with industries such as Upper Clyde Shipbuilders, Rolls-Royce, Fisher-Bendix, Jensen Cars, Hawker Siddeley, Govan Shipbuilders, Ferranti, and latterly the British Leyland Motor Corporation.
In addition to the big ones, there are small companies which have received and are still receiving Government assistance, and the House ought to ask itself—and that is what it has been doing for the last two days—why British industry has got itself into such a position. Why have successive British Governments failed to achieve their industrial aims?
There are a number of reasons for that, and I shall attempt to deploy some of them. Industry has undoubtedly suffered from the rapid rate of inflation, coupled with various economic and fiscal policies pursued by successive Governments. In addition, there are many examples of poor and bad managements which are unable to perceive the complexities of a rapidly changing technological world. The demise of small companies has led to the growth of multinational corporations and companies whose wealth in some cases is greater than the wealth of individual nations and whose power is greater than that of some sovereign States. These companies operate on a unilateral basis without any regard for the consequences of their actions either at regional or local level.
British industry has also suffered from low productivity. This stems largely from the fact that we have had a bad period of industrial relations, brought about mainly by the catastrophic decision of the Conservative Party to bring in the Industrial Relations Act—an Act which brought a positive concerto of confrontation into the industrial scene. I am glad that that Act has finally been buried.
There is another and even more important reason—and it has been touched

on during the last two days—why British industry is facing its present demise. This is the lack of investment in British manufacturing industry over the past 30, 20, 10 or five years. We have been positively gorged over the last two days with statistics and figures to show why British industry is doing so poorly, or so well, depending on how one interprets the statistics.
I asked the Library to let me have some statistics. If we take the percentage GDP invested in manufacturing industry, we learn that from 1968 to the present time we have invested 6 per cent., as against 8·2 per cent. in France, 9 per cent. in Germany, 6·2 per cent. in Italy, and 7·4 per cent. in the Netherlands. I assure the House that it gives me no pleasure to draw attention to our bottom of the league position in industrial investment.
Another example of industrial investment was poignantly brought to my notice the other week when, with some of my colleagues, I attended a meeting at Preston called by British Leyland Motor Corporation shop stewards, because some of us have constituency interests. We listened to what the shop stewards said, and at the end of the meeting they gave us a document which I find contains answers to some questions.
My right hon. Friend the Secretary of State for Industry said to the shop stewards, "You tell me what you think is wrong with British Leyland. You answer four questions which I shall ask you". The document says:
The main reason for the sickness in the British Leyland Motor Corporation is the lack of monetary nourishment."—
Those are their words, not mine.
As as result our productivity has been low—because of failure in past management to invest in equipment to do the job in hand as effectively as possible in order to compete intelligently with our competitors. It is no accident or the quality of the BLMC worker that his counterpart in Fiat, or Volkswagen can lay claim to producing twice and three times more respectively than the British Leyland Motor Corporation worker, but for the simple and indeed tragic reason that Fiat along with VW have a far higher rate of investment. Fiat and VW in 1972 as an example, invested £142 millions and £278 millions respectively against a relatively small amount of £42 millions in the British Leyland Motor Corporation.
So, by any reasonable yardstick that can be applied it is obvious that there has


been a failure to invest in British industry. That is tantamount to failing to invest in the future of the British nation.
I do not claim to be an economist but I believe that there has been a failure to invest in industry because it has been more lucrative to invest in land, building, houses and many other projects. If industry is not capable of generating its own finance, it must presumably go to the market. I do not know whether the Stock Market is a true barometer of the nation, whether it is a good thermometer in the mouth of the ailing patient. However, judging from its performance last year, it was more beneficial to invest money in a lousy, derelict building in the middle of London called Centre Point than it was to invest in British Leyland. A fact like that certainly concentrates the minds of my constituents who work for BLMC.
There is therefore an overwhelming case for the creation of an organisation which is tuned and developed to be an imaginative instrument of State participation, and I believe that the NEB is such an organisation. I should like to see the Board operate in four or five ways. It must first improve the basic industrial system and create economic wealth. Secondly, it must promote a wider public interest and make the activities of the industrial system more acountable to the public. It must also pursue a policy of involving the workpeople themselves. These aims are vital if we are to achieve the objectives of the NEB, and therefore all the interested parties must be determined to secure greater efficiency, more sensible management and a reconstruction of attitude towards industry.
The question of the voluntary planning agreements is by far the most difficult. There are many obvious pitfalls. I am not sure whether any of us know the exact ramifications of embarking upon a policy like this. I am sure, however, that there is a need for closer co-operation between Government and industry if we are to get the best out of both. We have seen in the past the economic and fiscal policies of Governments moving in one direction while industry has been moving in another direction, neither side knowing what the other is doing.
If there is one single main deficiency in the operation of the British industrial

system it is the inability by all parties—Government, companies and unions—to develop a useful, logical and sensible perspective. So the objectives of planning agreements should be to try to develop the capacity to formulate a strategy both in Government and in individual corporations and to promote a systematic perception and willingness in corporate management to see itself as contributing part of the whole social system. The Government must discipline themselves to be strategically orientated, and above all they must not accede to the pretence that they know best in this matter. They must seek a genuine and effective co-operation.
I am glad that the Bill contains provision for the extension of industrial democracy. There is a measure of agreement about industrial democracy in the House and I believe that there is an overwhelming case for it. We can see a growing determination among work people to become intimately involved in the decision-making process which shapes their destinies, and that is not unreasonable or unnatural. We have to proceed along these lines and we have to encourage that action because if we in Parliament fail to recognise this growing desire in the trade union movement and amongst the work people to have a piece of the action we do so at our peril.
The Explanatory and Financial Memorandum of the Bill says that the extension of public ownership into profitable areas of private manufacturing will be allowed. I declare my interest to the House in that I am a sponsored Member of the Post Office Engineering Union. For all my working life until I came to the House I was employed by the Post Office as a telephone engineer. The Government are well aware that the Post Office Engineering Union has made representations in the past that it should be allowed to manufacture its own equipment. My union believes that if we are to have an effective industry that will provide the nation with an adequate telecommunications network it needs the manufacturing provision. The Post Office needs to be able to manufacture its own equipment and it must be given the tools to get the work done. I hope that the Government will look sympathetically at that point. Both the Secretary of State and the Under-Secretary have accepted its validity.
The hon. Member for Canterbury (Mr. Crouch) said yesterday that this was a historic debate, and he was right. We are at a crossroads, on the threshold of great new opportunities. Either we carry on with the industrial policy of the past decade, which will surely lead to ruin, or we change that policy and we change it now. If we identify the problems and use the Bill to sort them out our industrial system will be a great deal better.

5.48 p.m.

Mr. Anthony Nelson: Whether this debate will turn out to be at a crossroads or on a precipice only history will tell. I agreed with many of the earlier comments by the hon. Member for Westhoughton (Mr. Stott), and I was genuinely moved by his ideas of the sort of industrial society that he would like created. The need for a new dynamism is recognised by all hon. Members.
In considering why we have been unable to secure an adequate level of investment, it is important to look back over the history of Government intervention in industry, particularly to the trilogy of legislative measures of the last seven years which started with the Industrial Expansion Act 1968 and which brought with it the IRC. The IRC's objectives and financial commitments have been added to by successive Governments in different Acts, but the 1968 Act was passionately opposed by the Conservatives for giving extensive powers to the Government in the form of enabling legislation. Those powers in that instance amounted to about £150 million, and that now looks somewhat paltry.
After the repeal of that Act and the introduction of the 1972 Act, which substantially increased selective and regional assistance by an initial £300 million, my right hon. Friend the Member for Knutsford (Mr. Davies) introduced the interesting new concept of non-culpable decline of industries, and that has been curiously absent from our debate. My right hon. Friend said on that occasion
We certainly have no intention of propping up inefficient management or an inefficient work force, but where such a firm has an important place in the economy we need to be sure that there really are insuperable obstacles to its continuation on a sound basis."

—[Official Report, 22nd May 1972; Vol. 837, c. 1020.]
It is interesting to note that there were few objections raised to the 1972 Act. The present Secretary of State did however say:
We believe that the arbitrary nature of the Bill is likely to strain relations between Government and industry given the massive range of powers which the Secretary of State has and the large sums involved."—
What an extraordinary statement that is seen to be when one looks at the open-ended, undefined and discretionary powers accorded to the Secretary of State in the Bill.
I add another statement which looks like another pas de deux by a member of the Government. On that occasion the present Paymaster-General said:
The Secretary of State does not have in his Department the administrative capacity to spend these amounts of money selectively and wisely. I therefore suspect that a great deal of it will be spent unwisely and for political and not economic and social ends."—[Official Report, 22nd May 1972; Vol. 837, c. 1031–92.]
I question what new change has overtaken the House, if he now vests greater confidence in the Secretary of State to make available large sums.

Mr. Dell: I made exactly the same point today. What is necessary is a Government agency which will have continuing responsibility for its actions. That is what I recommended then, and that is what I recommend now.

Mr. Nelson: That does not answer the point I raised, but I accept and understand the hon. Gentleman's standpoint on that.
Since the passing of that Act, the departure has been immense, signified by the White Paper and the Bill, both of which were based on the assumption that our poor economic record over the past decade can be reversed only by Government intervention in the form of ownership and planning. I believe the opposite to be true. If it were not for the profits and the earnings of those enterprises free from Government control, we should now be unable to pay for the growing deficits of the public sector industries.
We have had an interesting and in many ways constructive debate from the point of view of examining the determinants of the level of investment. The most


progressive remarks were probably made by my hon. Friend the Member for Ton-bridge and Malling (Mr. Stanley) yesterday. The hon. Member for Westhoughton made many points with which I concur. In my view—I hope this will not be taken as a negative point—the propensity to invest is largely determined by factors outside Government control. The international factors of investment confidence and propensities to consume and invest are significant determinants. Having said that, the fiscal climate in which industry operates is probably the largest domestic determinant of the level of investment.
To those quick to cry that with the large reduction in taxes, which was undertaken by the Conservative administration, such an investment scenario might not have followed, I would say that further determinants must be the economic climate, political stability and expectation of both continuing for a reasonable period of time—in other words, confidence.
As well as needing to see the prospect of an adequate return on capital employed, industry needs a reasonable time scale, free from the stop-go policies of successive Governments, in which to operate. The Government's possibilities of obtaining this objective are to a certain extent limited by international factors. Above all, stability is the important factor, and to that extent the Government by doing nothing are not necessarily taking a negative attitude in encouraging a level of investment.
Thirdly, the level of investment is, as economists will know, to a large extent a function of saving, the propensity for which must certainly be on the decrease.
I agree with comments from all sides of the House on the need for a progression to more adequate industrial relations. I yesterday asked the hon. Member for Bethnal Green and Bow (Mr. Mikardo) in an intervention why, if he so vehemently proposed vast State extensions, countries such as Germany which had a more free enterprise system than our own, were able to achieve a far more successful economic record. His answer were threefold, the two major points of which were that there is in that country a far more

dynamic intervention by institutions which had shareholdings in companies and there was a higher degree of distribution of dividends.
To a large extent I accept both of those points. They are the positive points that we should be trying to amend in order to create the sort of industrial environment in which free enterprise can operate profitably, so that we shall not have to put Government and taxpayers' money into loss makers for a succession of years.
The arguments for and against Government ownership and intervention have been the subject of detailed empirical study. In the last resort I believe it comes down to whether the opportunities and the rewards of employment and investment are greater under a State-controlled economy than under a free enterprise one. Very often the argument against the State's taking a passive rôle when major enterprises come across liquidity problems is the unemployment consequence. Arguments for a passive rôle are termed right-wing, but my philosophy is that the end result of massive Government intervention and the use of taxpayers' funds for the propping up of massive loss-making companies will not be just a high level of unemployment but an absolute level. There comes a point at which one cannot succeed in covering the deficits of a growing public sector by taking profits and revenues in the form of taxes from industry or individuals. They just will not be there. The only option is either to borrow abroad, when one's credibility has fallen, or to go back to the money-printing machine, which spells certain disaster.
I accept the need for a mechanism by which Government may exceptionally take a temporary stake or provide temporary financing for a concern which might otherwise go bankrupt, causing a chain reaction of bankruptcies and mass unemployment. But I accept that need only on the strictest conditions concerning duration and reorganisation. It is no function of Government to make an open-ended commitment with taxpayers' funds when there is no quid pro quo in the concern involved in the form of wage restraint, at least indexed to the level of inflation. In this instance I quote the example of the £50 million


Government guarantee for British Leyland which was forthcoming, and without such an undertaking.
I turn now to the National Enterprise Board. I hope that the Minister winding up the debate will explain what the Board will be and who will own it. We are told in the Bill that it will be a body corporate having perpetual succession and a common seal. We are told in Clause 1 that it will not be a servant or an agent of the Crown. I fail to see who will own it and to whom it will be responsible. I fear that eventually—with large sums being made available to it—it will start to grow of its own volition. I seriously question the composition of the Board.
I have no doubt that an impressive array of members of the Board will be forthcoming. But I also have no doubt that the Board will be a puppet of the Government, with the Secretary of State holding all the strings. We know that all the members of the Board, under the Bill, will be appointed, paid for, financed, directed and sacked by the Secretary of State. It will be a puppet body. Both the public and this House should not be deceived into thinking otherwise.
Thirdly, I would like a more adequate explanation of the criteria for investment which the Board will use. This afternoon the Minister—in very woolly words—tried to explain the provisions in Clause 2 appertaining to this matter.
I should like to know in particular what financial criteria will be attributed to prospective investments and how he reconciles those criteria with the preferential treatment of the NEB under Schedule 1, Clause 18, whereby it will not be liable for stamp duty, which of course provides a very important cost determinant of acquisitions in the private sector at the moment. Under Schedule 2 preferential financing can be made available. This will promote unfair competition.
I would also question the underlying view that the ability exists amongst members of the Board or those who direct it to acquire industries and enterprises and inject expertise and investment into them which will be far more successful in social, economic and—and I question this above all—commercial terms than that of a profusion of people in free

enterprise industry who have direct responsibility for monitoring industrial opportunities. Indeed, who are those 250 supermen who will be advising this puppet body.
I also want to make a comment on one aspect which has been questioned, and that is the question of debt or equity financing by Government concerns. I believe it was the Secretary of State who asked yesterday who would suggest that Government financing should not be accountable and should be undertaken without an equity stake in the industrial field. I for one would suggest that. I believe there are great advantages in debt financing through the Board or direct by the Department of Industry or the Secretary of State. For I believe this is very much in line with the intention behind Sections 7 and 8 of the 1972 Act that such finance be of short duration and it is quite possible to apply to debt financing the same or indeed more stringent conditions than are applied to equity financing. But it also goes to the base of my argument that it is no function of Government to put up taxpayers' money in the form of risk capital.
I think it is essential that these points be answered before the Bill is given a Second Reading and I join my hon. Friends on this side of the House in opposing the underlying principle.

6.03 p.m.

Mr. Giles Radice: I hope the hon. Member for Chichester (Mr. Nelson) will forgive me if I do not follow him in all his remarks although on the whole I think he spoke in a more thoughtful way than his Front Bench spokesmen. Instead I want to join my hon. Friends on this side of the House in giving a very enthusiastic welcome to the Industry Bill.
The objectives of the Bill were clearly outlined to the House in the impressive speech yesterday by my right hon. Friend and in an equally impressive performance by my right hon. Friend the Paymaster-General. We on this side of the House are convinced that the National Enterprise Board and the Planning Agreements that go with it, if taken together, provide perhaps for the first time an effective instrument for the restructuring of British industry. The Board has, at any rate for the first few years, an adequate


source of finance. It has the necessary powers, as laid down in Clauses 2 and 3, to do a valuable job and, through its ability, with Government approval, to acquire shareholdings and to extend public ownership, it will be able to safeguard the community interest and resources.
The passing of this Bill through Parliament will represent, we believe, a ray of hope for British industry and those who work in it. My union, the General and Municipal Workers' Union, which sponsors me and a number of other hon. Members, strongly supports this Bill.
I understand from the intemperate language we have heard from the benches opposite, and particularly the Front Benches, and from the media that this Bill will receive a rough handling in its passage through the House of Commons. I do not think anybody in this House seriously believes that, if by chance the passage of the Bill were mercifully speeded up, the faults of British industry, the deep-lying faults, the structural flaws, the slow rate of investment, the lack of competitive edge that everybody who has spoken so far has talked about, the authoritarian decision-making process, would be eradicated overnight. As my right hon. Friend the Paymaster General has made clear, it will take time, and if the National Enterprise Board is to make an effective contribution it also needs to operate against the right kind of background.
In this connection I want to make three points. First, if the National Enterprise Board is not to become merely a glorified rescue service it must operate within the confines of a clearly worked out industrial strategy directly related to the present weaknesses of the British economy. We must identify those industries in which there is the greatest export potential. For example, there is now a growing and profitable market for British capital goods and engineering products in the oil-producing countries and the other countries which have benefited from the explosion in commodity prices. Yet so far, judging from the figures, we have not taken full advantage of this opportunity.
We need also to identify the supply constraints in industries such as engineering, machine tools and steel, which lead,

every time the British economy grows, to a sucking in of imports and therefore to balance of payments difficulties. Equally important, we must develop as quickly as possible our own North Sea oil industries. Obviously, the Departments of Industry and of Trade will need to co-ordinate their activities very closely here, and there is also an important role for the tripartite planning body, the NEDC, which has already done much valuable work in this field in identifying the obstacles to growth and in looking at ways of saving imports.
My second point is that if the National Enterprise Board and the planning agreements are to supply that extra dimension we need so badly in regional policy then, once again, it must operate within a strategic framework. What is needed above all is a strong central commitment to regional policy and, at regional level, planning authorities with the ability to analyse the strengths and weaknesses of regional economies and, together with the National Enterprise Board and Government, to act on that knowledge. We do not have that at the moment. We need it.
My third point is about industrial democracy. I fully support the approach of my right hon. Friend the Secretary of State for Industry to this question and welcome all he has done already and is doing to involve trade unionists in the running of the economy and of industry. He is absolutely correct when he says that we must build on and develop existing trade union strength and achievements in collective bargaining. My only query is that I hope the Secretary of State will not confuse the wholly desirable dissemination of information as contained in clauses in this Bill with industrial democracy. We recognise that the subjects are connected, but industrial democracy is about power; it is not about consultation or information, desirable though these may be.
In my view, and in the view of the TUC, it is now essential that there should be joint regulation of matters vital to workers lives, such as investment, closures and re-employment, mergers and takeovers—all the central questions of corporate strategy. I remain agnostic about the constitutional framework within which these subjects should be discussed:


that is a matter for the trade unions and employers concerned. But, equally, I see no reason why, if trade unions wish to exercise joint control at board level, Parliament should not in the future allow that opportunity. Therefore I ask the Secretary of State not to close his mind to the idea of 50 per cent. trade union representation at board level. I believe he would be well advised to keep his options open on this.
I shall be voting for the Industry Bill, convinced that it represents an important new initiative which deserves support not only in this House but outside it and on both sides of industry. I am confident that it will get that support in the coming months.

6.10 p.m.

Mr. Cyril Smith: I listened to the Secretary of State yesterday and the Paymaster-General today. It seems to me that yesterday we had the soothing of the Left and today the soothing of the Right.
It is agreed by both sides of the House that industrial investment has been at a very low ebb for many years. If I may say so, with respect to the hon. Member for Westhoughton (Mr. Stott), he needs to learn the difference between investment in industry and investment by industry.
There are many differences of opinion on the question why industrial investment has been at this low ebb. It has been alleged that some of the blame can be lodged at the door of the Secretary of State himself. However, since that low investment has occurred over a number of years it is a little unfair to blame the right hon. Gentleman for the present situation. He has held his present views for only a comparatively short period. It is not that long since he shed his ancestry. Only in later years and in what I regard as his least mature years has he sought to take the line towards industry that he now adopts. I do not blame him for the long history in this matter.
I suspect that the real reason is constant Government interference with and dabbling in industry. Over the years, it has grown more and more and existed to a greater and greater extent. It is a

position which has been adopted by successive Governments.
For me, the weakness of the Bill is the promise of even further control and intervention. I became an employer of labour some 12 years ago. I realised soon after I started a company that I had become a kind of Government agent for the amount of bumph which employers are now expected to read and to complete on behalf of the Government. The amount of bumph is quite phenomenal and the unproductive finance which it takes to deal with it is equally ridiculous. Employers are tax collectors, insurance collectors, and fines collectors. We fill in forms for tax purposes, grant purposes, welfare purposes, payment purposes, training purposes, wage research purposes, VAT purposes and sales and purchase statistics purposes. They come one after another. Industry employs armies of non-productive people to do all this fiddling and messing about. I concede that some of it is necessary, but, equally, a great deal of it is unnecessary. I take the view that much of it is superfluous and designed simply to keep armies of civil servants in gainful employment.
Under the Bill the list will be added to, and I was intrigued to read in the Explanatory and Financial Memorandum that it is believed that only 250 additional staff will be needed to administer it. Well, we shall see, but I suspect that the net result will be not 250 additional staff but 250 additional heads of Department.
I have never been in favour of propping up lame ducks. I said as much in the Liberal Supply debate last week. I made no secret of the fact that I differed from some of my colleagues in that respect. I believe in a free enterprise system. I also believe that if, within that system, an industry is not capable of maintaining itself, it should go to the wall. But let it be clear that if we are to have a free enterprise system, free enterprise is entitled to work and to be judged on the rules of free enterprise. It is no use applying rules to a system and then saying that the system has failed when the rules applied are unfair and do not allow the system to work in the way that it should, or in the way that it was conceived.
If prices are controlled but wages are not, and then we say that free enterprise


has failed, that cannot be a correct assessment or a fair judgment. If we have a free wages system, there must be a free prices system. If we control wages, we must control prices. If we control prices, we must control wages. If profits are taxed at a level which makes investment difficult, that, too, is ridiculous.
I often wonder why some Socialists worry about getting interests in various companies. They have a great interest in my company. They take more than 50 per cent. of my profit without asking. They have a great interest in my company and in others which are making profits.
Another weakness in the system which strikes me as ridiculous is that a company can make a profit and decide that, instead of distributing it, it would like to invest it in capital plant or building, only to find that the law is such that it is compelled to distribute part of the profit even if it does not wish to.
There are many matters which need sorting out in terms of reinvestment in industry and by industry before we come to consider this measure. Certainly we need a reappraisal. But most of all, what industry needs is some guarantee of its future stability. I think both Front Bench spokesmen touched on this matter. Industry needs confidence in the future. It needs confidence in its future right of ownership of its business. It needs less and not more interference by people who may be excellent politicians but who, to put it bluntly, know nowt about business and about the intricate running of a business. Such people would be better leaving it to those who know about industry and who work in it. Those who have spent the whole of their lives sitting in the holy atmosphere of this place should not go preaching to people about how things should be done when they know nowt about it because they have never had to deal with it in their lives.
I accept that we have to consider lame ducks in terms of the national economy and of unemployment, but I see no reason for State intervention on any other grounds, such as those set out in Clause 2(2)(c) which talks about the extension of public ownership.
I am extremely interested in Clause 2(2) concerning the extension of industrial democracy. I welcome the conversion of the Conservative Party to worker

participation. I gather that it is now in favour of it. I have never noticed it before, but I am delighted that it has been converted to the Liberal point of view.
If we talk in terms of industrial democracy, however, this Bill is a sham. It makes no contribution to industrial democracy. It will bring no joy to workers who see control pass from an employer to the State.
I recommend right hon. and hon. Members to talk to workers in the nationalised industries and to ask them how much influence they have in the policy or in the administration of the concern for which they work. They will say they have none. I have spoken to thousands of workers in nationalised concerns. Although it may give them some slight feeling of stability or security in their employment, in terms of participation in their industry it makes no difference to them whether it is a privately owned industry or is nationalised.
If any hon. Member is in doubt about that, I invite him to go, as I did, to talk to the workers' action committee at Shotton steelworks. I challenged the Secretary of State on this point when he made his statement on steel a few days ago. You go and talk to them as I did, and ask them. They are in a nationalised concern—[Interruption.] I should say, Mr. Deputy Speaker, that I hope that Government and Opposition Members will go and talk to them.

Mr. Deputy Speaker: I was only going to say that I have been there.

Mr. Smith: And I was going to say, Mr. Deputy Speaker, that I have no doubt at all that with your Welsh fervour you would have anticipated my advice. But the fact is that I talked to them after I had had lunch with the director of the steel board at Shotton.

Mr. Thomas Swain: rose—

Mr. Smith: The hon. Gentleman must not get worked up, because he will get a shock in a minute. I had lunch with the director and pleaded with him to meet representatives of the workers' action committee. He said to me, "I am not prepared to deal with anybody but trade union representatives. I am not prepared


to meet a workers' action committee." Indeed, the Minister of State's own boss, the Secretary of State, admitted—[Interruption.] The Minister of State may have no boss, but from the Prime Minister's speech last week it was quite apparent that the right hon. Gentleman the Secretary of State for Industry has a boss. The Secretary of State admitted from the Dispatch Box, in his statement on steel, that it was the noble Lord from the other place who had met the workers' action committee rather than the director of the steel board.
So, in terms of worker participation, as the State stands at present, it means nothing at all. Whether under the Bill it will change we have yet to see. One thing is certain; under the Bill the Secretary of State can introduce ad hoc schemes for worker participation. We need to replace the whole of the present system with an orderly movement towards forms of planned worker participation. Under the Bill the Secretary of State, far from doing a service towards worker participation, could, in fact, be responsible for destroying confidence in worker participation by introducing ad hoc schemes of different kinds throughout the country, rather than having a planned form and growth.
Certainly that part of the Bill, as opposed to the belief in worker participation, does not thrill or interest me in the least. My Liberal colleagues and I want to see worker participation but not in an ad hoc form.
Clauses 20 to 24 of the Bill deal with the disclosure of information. These clauses are somewhat alarming. The first thing I should like to find out is for what purpose the disclosure of information is required. It is certainly not very clear in the Bill. The Bill seems to envisage two completely different purposes, because it sees a dual procedure of disclosure. One discloses information to the Government and then one discloses it, if the Secretary of State so decides, to the trade union. In many countries the disclosure of such information is for the purpose of negotiation and wage bargaining and it cannot be used by law to harass management. The proposals in the Bill involve classifications, not all of which come within the six headings of the CIR report on information which is suitable for disclosure.
In some respects the categories in Clause 21(2) are considerably narrower than those six headings, and have little to do with industrial relations in any form. The Bill obviously envisages a mixture of information, some of which will be useful to the Government and some of which will be useful to the trade union movement, although in the latter case it appears to be information that would not be useful for bargaining purposes. That being so, it is extremely surprising to find in Clause 24(2) that once such information has been passed to trade unions, the obligation of confidentiality is lifted. Clause 22 makes it clear that the information is to be passed to a representative of each relevant trade union. Anyone who knows anything about trade union structure will know the danger that it may not even reach the shop floor, let alone be helpful to the people involved.
Clause 20 limits to manufacturing industries the whole operation of the disclosure of information. Hence the conclusion that we have to draw is that it has very little to do with collective bargaining. One must then ask, if it is not to do with collective bargaining, why information given to unions ceases to be confidential.
The appeals procedure envisaged in the Bill is on the verge of the ludicrous, because it is very difficult to see on what basis information is to be supplied. It is equally difficult to see on what basis an employer can appeal against that information being made public. It remains to be seen what kind of appeal committee will be set up. There are those of us who believe that it may be yet another instance of jobs for the boys. It will be very worth while to be a trade unionist in this country because of the number of jobs that will be created for trade unionists by this Government in all sorts of fields, such as health and safety at work; worker participation; representatives on boards of directors; sitting on boards of national development corporations; sitting on appeals tribunals to hear whether information should be made public. They are going to have a field day, these lads. I would tell anybody that under this Government at the present time it is an investment to take out membership of a trade union, because he might be very surprised at the fruit to which it will lead in a short time.
The intriguing question is: what kind of committee will be set up for the appeals procedure? Presumably, members of the committee will have some kind of expertise. What sort of expertise will it be? Will the committee consist of people who can assess whether information is confidential? If so, from where will they be drawn, and so on and so forth? It is anybody's guess what this appeals procedure will be, who will comprise the appeals procedure committees, what level of confidentiality there will be, or what confidence there will be in the confidentiality aspect by industry itself.
In short, I am saying that this Bill is ill-conceived. To put it bluntly, in my language, it is a rotten Bill, and for that reason my colleagues and I will vote against it.

6.28 p.m.

Mr. Stan Thorne: Having just listened to the hon. Member for Rochdale (Mr. Smith), I hope that he will see fit to send a copy of his speech to the Rochdale Trades Council and trade unionists in Rochdale who, I am sure, will be extremely interested in his observations today.
I am sorry that the hon. Member for Bury St. Edmunds (Mr. Griffiths) is not still with us. He made a comment about the absence of members of the Tribune group during one part of his speech. While I cannot pretend to speak for the Tribune group, I happen to be a member of it. It is a pity that the hon. Member will not be here to listen to what I have to say.
I am also sorry that the Minister of State for Industry has left the Chamber, because I had one or two questions that I wished to put to him.
The essence of the speech of the hon. Member for Bury St. Edmunds seemed to be that we were bent on following a perilous path, and that our footsteps were "Nationalise, nationalise". During the General Election in 1974, that seemed to be the only platform that the Opposition were putting to us and to the people. They claimed that if a Labour Government were elected nationalisation would follow, and various other things would stem from that. When one reads the Bill, however, one finds that it is quite clear that that is not so. There is

nothing in the Bill which nationalises a large or a small industry at present. All that the Bill does is to establish a National Enterprise Board. The Board has no powers under the Bill to nationalise any part of industry.
What does the Bill seek to do? It seeks to obtain a 30 per cent. share in profitable areas of manufacturing. Many firms in manufacturing will be only too pleased to have that sort of financial input, because clearly they are suffering from cash flow problems of various sorts. The suggestion that a further 30 per cent. share should be taken cannot be approved under the Bill. It would seem that that is a matter for Cabinet approval. Given the sort of speeches that have been made recently by members of the present Cabinet, they are hardly likely to agree with the further acquisition of 30 per cent. shareholdings in many of these firms.
It is also quite categoric in the Bill that there is no power of compulsory acquisition. I want to ask the architects of the Bill a very simple question. Why not? It seems to me that there are certain industries which, in the national interest, could well be taken into complete public ownership. I refer particularly to the drug industry. We all know the cost of supplying medicines for the National Health Service and some of the problems that we have had in recent years in regard to manufacturing in this respect. We all know that health is something which concerns all the people in our society. It is something that we seek to foster to the best of our ability. To make profits out of people's health is completely immoral. The case for the nationalisation of the drug industry has been well made in the past. Therefore, why not consider including it in the Bill?
Several hon. Members have commented on the promotion of industrial democracy. The Bill contains no definition of that term. The hon. Member for Rochdale commented on this matter. I share some of his cocern—but from a position that is vastly different from his. Within the Bill it is clearly stated that it is the Secretary of State's intention to establish a shift of power in favour of the workers. But shall we do that by putting forward the idea of a couple of worker-directors in one or two firms?


Shall we do it on the basis of restructuring industries, so that decision making within them goes through some system of shop stewards' committees—the sort of thing that the hon. Member for Rochdale would obviously deplore? Is that what we really mean? Is that the sort of shift in power that the Secretary of State has in mind? If so, why does he not make it clear in the Bill?
Given the sort of statements which have been made in public in recent months, the Secretary of State does not appear to have in mind any real concept of workers' control when he talks about industrial democracy. We had better leave it until he has had the opportunity of introducing a clarification regarding that part of the Bill. I should like to continue at some length on the subject of industrial democracy, but time does not permit it.
The Bill is concerned with managing State holdings in companies within the private sector. That sounds fine, as far as it goes, but should not the public have a say if we are to be involved in putting money into the private sector? The obvious answer—it is contained in the Bill—is "Yes, we should have a say".
Then there came out of the Bill certain things which perturb some of us on the Government side of the House. The Bill talks about promoting mergers, and considers that to be something of a priority. I remember that the Industrial Reorganisation Corporation was responsible for strengthening and not reducing the grip of monopolies in Britain. If the Bill is intended to prop up capitalism because that has failed to reinvest from the glorious profits which the Opposition have been telling us were made during the early 1970s, I want to seriously question it.
For myself and for many of my hon. Friends, the Bill is about shifting the power of the economy—as the Bill says—from those who control it through private property and private investment to the workers in industry who produce the goods which are sold by the giant monopolies. That is what I thought the Bill was all about, but if the Bill is to provide for rationalisation and economies of scale, that means to many of us, under the present system of society,

redundancy, unemployment, and a wastage of skilled manpower. The Bill does not clarify this point sufficiently for me, at any rate, to accept it in the sort of glowing terms which have been used by some hon. Members.
The Bill talks of voluntary planning agreements, and mentions the question of information. Not much has been said, however, about the withholding of information where it is considered prejudicial to the firm. It can be withheld from trade unionists within the firm on that basis. I do not know quite what is meant by that. Does it mean that we do not really trust the trade unionists within particular firms for certain reasons?
The hon. Member for Bury St. Edmunds (Mr. Griffiths) mentioned that profits had been made in industry for a number of years but that investors did not invest because they had no confidence in prospects within the country's economy generally. It is that sort of sentiment which I do not trust, when investors take decisions—as they always do—on the basis of what is in the interests of private profit rather than the interests of the community as a whole.
A figure of between £700 million and £1,000 million is the capital which the Department of Industry, or the NEB as it will be called, will get. I do not know whether anyone has done any arithmetic in regard to what that means in terms of capital investment in British industry generally, but it seems that the Board has one of two alternatives for that sort of money. It can take a very small interest in a very few firms, or a major interest in one or two firms. In certain firms it would not even get a major interest for that sort of money.
What emerges from a close examination of the Bill is that public ownership, far from being the sort of thing that this Labour Government were going to introduce right, left and centre, has virtually been abandoned. The Bill seeks to continue to promote a mixed economy within capitalist Britain. It seeks to give the Government a rôle as junior partners in private industry. I feel that it will be a National Enterprise Board—I may be completely wrong—dominated by big business. Why do I think that? I take that view because we go straight away to big business for the potential


chairman of the NEB. It seems that it is the opinion of the Government Front Bench that we have no national trade union figure who has the capability to do that sort of job. I strongly repudiate that.
I believe that we have some capable forces in the trade union movement who would be quite able to take a firm grip of British industry under a Socialist administration. It is interesting to remind the Government—I am not sure that the Under-Secretary of State will need reminding—that only a short time ago various deputations were formed from within the motor car industry. It is now fairly clear what the workers in that industry feel about the suggestion that the National Enterprise Board might give a bit of a fillip to British Leyland.
We are talking about £100 million for five years. That £500 million will be needed to replace outworn plant and to get the industry on a profitable basis. Where does that fit into the notion of a National Enterprise Board? It seems that we shall have spent the money before we have even started, if we are to be effective. I do not think that we shall be effective; I believe that we shall attempt once again to effect a patch-up job. It seems that the workers in British Leyland have it right. They are calling for outright 100 per cent. nationalisation of British Leyland. That is the sort of demand that we should support.
The Bill falls well short of the sort of Socialist legislation that I expect from a Labour Government. I have some questions which I should like to put to the Minister of State if there is anyone present who represents his interests in his absence.

The Under-Secretary of State for Industry (Mr. Gregor Mackenzie): That is an unfair comment.

Mr. Thorne: How far does the establishment of the National Enterprise Board take us towards the achievement of a planned economy such as the Minister of State and I used to talk about in the constituency Labour Party of which he and I were chairman and secretary, respectively, about 20 years ago? How effectively shall we be able to control our resources on the basis of the 30 per cent. interest in some firms? Once again

it seems that it is necessary to tell the Government Front Bench—I know that it is useless to say this to the Opposition Front Bench—that in the House decisions should be taken that are based on people's needs and how we can meet them.
The evidence has shown throughout my lifetime that we can effectively meet the needs of the people only if we can control resources, and if we can plan the utilisation of those resources. We can do so if we eliminate private profit. I did not say profit, but "private profit". Of course, we want industry to be organised in such a way that it will produce a small margin which can be ploughed back to the Exchequer to build houses, hospitals, schools and nurseries. That must be done. What we have to eliminate is the parasitical section of our community that continues to want to run British industry on the basis of private profit.

Mr. Deputy Speaker (Mr. George Thomas): Before I call the next hon. Member, I would point out that there are roughly two and a quarter hours left for back benchers to participate in the debate. Unless we have shorter speeches there will be a great many disappointed Members.

6.46 p.m.

Mr. Churchill: The hon. Member for Preston, South (Mr. Thorne) will not be surprised if I do not take up his remarks. However, I might follow his line of attack against the Government. I found it extraordinary that the hon. Gentleman should find no provision in the Bill regarding the nationalisation of companies. Clause 8 provides that the NEB shall not, without the consent of the Secretary of State—and that is some safeguard—acquire shares in a company if that will give the Board control of 30 per cent. or more of the voting rights. If the hon. Gentleman believes that that is in any way a safeguard for this House or for British industry, as against the utilisation of the Bill as a vehicle for nationalising firms, I must say that he has a great innocence.
There is one common theme which I think is accepted by both sides of the House, namely, that since the last war industrial investment in our economy and industry has been grossly inadequate.


The difference of opinion—it is a sharp one—arises over the way in which that situation has come about and what should be done about it.
I believe that it was the contention of the hon. Member for Rochdale (Mr. Smith) that the principal fault rests not with industry or with the workers, but with Government. I agree that successive Governments of every political colour have sought to meddle with industry. They have brought about a situation in which there is not ony a mass of paper work and a great deal of work for civil servants in Government Departments but a massive amount of work for bureaucrats in industry to undertake in replying to the civil servants in Government Departments. There is a situation in which large sectors of British industry are wholly unprofitable. Paragraph 3 of the White Paper entitled "The Regeneration of British Industry" says that in 1971
investment for each worker in British manufacturing industry was less than half that in France, Japan or the United States, and well below that in Germany or Italy.
What a damning indictment of six years of Labour Government if it reduced industry to that level. Where was the present Secretary of State for Industry during that period? Was he not in command of the Ministry of Technology? Was not one of his tasks to further the interests of British industry? Yet, after six years of Labour Government, that low level of investment prevailed.
The former Conservative Government brought about a situation whereby, at the end of 1973, we had a high level of investment intention announced by British industry. I saw evidence of that in my constituency. In Trafford Park there is the biggest industrial complex in Western Europe. At the end of 1973, industry was working flat out. The only shortages were of skilled labour and certain components. That must be compared with the present situation.
Let us examine industry's capital expenditure based on constant 1970 prices. The Trade and Industry Journal, published on 30th January this year, shows that in the three years from 1968 to 1970 the average investment by industry was £3·6 billion; in the years from 1972 to 1974, under a Conservative Government, the figure was £3·8 billion—an increase of

more than £250 million per year. By 1974, the figure was £350 million a year higher—virtually £4 billion a year. It is regrettable that under the Labour administration investment this year is likely to be between 7 per cent. and 10 per cent. lower.
What is the situation today? In a period of 15 months we have gone from a record level of investment intention to the lowest recorded level. Inflation is running at twice the rate it was a year ago; wage inflation is running at record levels; sterling is plunging, relative to other European currencies; unemployment is rising rapidly. The Minister may laugh, but in my constituency, unemployment has risen by 50 per cent. since the Labour Government came into office. This is a matter of grave concern to my constituency and to those who earn their livelihood in the industry which is situated at Trafford Park.

Mr. Robert Kilroy-Silk: A few moments ago the hon. Gentleman referred to the low investment intentions during the three or four years of Conservative administration. He attributed that situation to the earlier six years of Labour Government. Is he now attributing the high unemployment levels in the last year to the previous four years of Conservative administration?

Mr. Churchill: No, indeed. I think there is no doubt—this factor may not be sufficently appreciated by hon. Gentlemen and, above all, by right hon. Gentlemen on the Labour benches—how long it takes to create an environment of confidence in order to bring about investment, nor is it appreciated how quickly confidence can be destroyed. This is precisely what the present Labour Government have achieved—a situation in which British industry is facing rigorous price control, additional taxation, unrestrained wage inflation and, above all, the most disastrous collapse of industrial confidence. These things have been brought about directly by the threats and activities of the Secretary of State for Industry. They have brought about a collapse of industrial confidence in this country unparalleled since 1930, and, indeed even greater than the crash of confidence at that time.
Has there been a similar crash of confidence in the economies of the United


States, France, Germany, and Japan—countries which the Secretary of State for Industry is so fond of citing. The answer is "No". Only in the United Kingdom has there been such a gross collapse of industrial confidence.
What is the reason for this situation? What is unique about the United Kingdom? We are not the only ones who are suffering from the increased price of Arab oil or from the levels of imported inflation. The one thing that is unique is that we have the Secretary of State for Industry. Other countries—our competitors—are not burdened with him.
We have seen in recent weeks the Bill put forward by the Secretary of State for Employment for gagging the Press; we have also seen the Chancellor of the Exchequer's Bill for confiscating savings. We now have this Bill, introduced by the Secretary of State for Industry—a Bill which will destroy British industry. The Bill will give the Secretary of State the most sweeping powers. It will enable the NEB to purchase profitable or unprofitable industry. It will provide for Planning Agreements which will require the disclosure of hitherto confidential commercial information.
The Secretary of State argues that the decline in the number of workers in the manufacturing industry is a matter for concern. I agree that it is a matter of concern. I have seen the situation vividly illustrated in my constituency with the decline in heavy engineering. That work has not gone to other parts of the country, such as to Merseyside, in the constituency of the Minister of State, Department of Employment. It has gone to Germany and to Japan. There has been a basic failure of investment in this country. But it has happened, above all, in those sectors of industry where the Government have a special responsibility.
I refer to the nationalised industries, which for so long have been starved of adequate investment. They have been the industries operating with outdated works, so that 5,000 workers in the Irlam steelworks found themselves thrown on the slagheap of unemployment. Over the decades, since the vesting of the Steel Corporation, we have seen a situation of inadequate investment. Indeed, it was my right hon. Friend the Member for Worcester (Mr. Walker) who did more

than any other Minister to inject new life and investment into the nationalised industries to try to bring them into the second half of the twentieth century.

Mr. Kilroy-Silk: That is why the right hon. Gentleman has been dropped from the Shadow Cabinet.

Mr. Churchill: We have a situation in which the number of employees in manufacturing industry has increased in the United Kingdom from 8 million in 1950 to 9 million in 1970—a fairly substantial increase. The nationalised industries employed 2 million people in 1950, and that figure was reduced to 1½ million workers in 1970. However, the really dramatic increase has been in central and local government bureaucracy, which has increased from 3 million in 1950 to 4·4 million today.

Mr. Dennis Skinner: What has this to do with the Bill?

Mr. Churchill: It has a great deal to do with the Bill, because this legislation will put more civil servants on the backs of the workers and more Government interference on the backs of British industry. It certainly will provide no remedy to the problems that face British industry today.
The number of industrial workers in the manufacturing industry and in the nationalised industries in 1950 amounted to 10 million, and today the figure is 10·5 million. However, in that period the number of civil servants has grown from 3 million to 4·4 million. In other words, the Civil Service in the last 20 years has grown 10 times as fast as has the number of workers in manufacturing industry.
Therefore, the Bill which is now before the House will mean an acceleration in that growth. We must consider the Bill against the criterion whether it will achieve what the Secretary of State for Industry says he wants to achieve—namely, an efficient public sector. There is no evidence advanced by Government spokesmen in this debate to support the argument that Government control or interference in any way assists in bringing about efficiency in industry. Indeed, if the time it takes to process housing applications for desperately needed housing starts in my constituency is anything to


go by, it takes four years to get a planning application approved by the Department of the Environment. If that is the situation industry is to face, we shall be quickly on the road to bankruptcy.

Mr. Skinner: In view of the hon. Gentleman's remarks about growing bureaucracy and all that goes with it, why did he vote for VAT and local government reorganisation?

Mr. Churchill: The hon. Gentleman may not be aware—there is no reason why he should be aware—that local government reorganisation in my constituency in the Trafford district of Manchester has brought about a rationalisation and a reduction in the cost to the taxpayer—[Interruption.] It was done under a Conservative council, and that is why it was able to make the reductions.
The NEB is irrelevant to the solution of the problems of British industry. It will be the biggest obstacle to the regeneration of British industry. It has already had the effect of drying up investment to a remarkable degree, because the Government have declared war on the free-enterprise sector of British industry, which accounts for three out of every four jobs and for 95 per cent. of Britain's exports. Why was the Bill proposed? It is nothing other than the plaything of the Secretary of State for Industry, and something to keep him occupied—this pampered progeny of the peerage who seeks to play-act as the leader of the workers' revolution.
The NEB will be organised, as the Government admit, on the lines of Mussolini's IRI and Franco's INI, which was a similar institution. It is strange that the Labour Party should be so keen on embracing the doctrines and the remedies of Fascism, but that is what it intends to do in the vote this evening. There is no evidence that the Bill will provide for greater efficiency in industry. It will not provide for any more investment in industry. Nor is there any evidence that it will benefit the ordinary working man, as claimed by the Secretary of State yesterday.
I thank the Secretary of State for Industry for announcing the names of the 150 firms which are to be subject to the Planning Agreements. Eighteen are in my

constituency, including British Oxygen, Burmah Oil, CPC (UK) Limited, the Co-Operative Wholesale Society Limited, Courtaulds, General Electric, Guest, Keen and Nettlefords, ICI, the SGB Group, Turner and Newall, and the multinational companies such as Ciba-Geigy (UK) Limited, Esso Petroleum, Gulf Oil (GB), Massey Ferguson Holdings, Michelin, Procter and Gamble, Shell Oil and Texaco.
Is it seriously suggested that the Secretary of State, sitting in his tower block in Whitehall, with his army of 10,000 civil servants—not forgetting the 250 proposed to be added under the Bill—can seriously help industry and the workers in Trafford Park?
Since attracting foreign cash and investment has become the cornerstone of the Chancellor of the Exchequer's plan for the economic survival of Britain, does not the Bill fly completely in the face that plan?
Trafford Park has already suffered enough from the deprivations of Labour Governments. During the period in office of the last Labour Government, 10,000 jobs in my constituency were lost. That fact is not forgotten. During that period political gerrymandering prevented new industry coming to the area. I quote one example. The Kellogg Company of Great Britain wished to expand in my constituency, where it has a major plant. Under the Labour Government that firm was told "You cannot expand in Stretford; you must go to Huyton". I wonder whose constituency that is?
The hon. Member for Rochdale has already referred to the Minister's concern for industrial democracy and the welfare of the working people. That does not cut much ice in Trafford Park, where all those jobs were lost under the last Labour Government. The people in Trafford know what sort of regeneration to expect from a Labour Government.
No provision is embodied in the Bill for the workers at any plant or industry to be consulted before Planning Agreements are forced on their companies, or before nationalisation or State control ensues. Is not this an omission which the Secretary of State would do well to remedy? I find it strange that the criteria of experience laid down for members of the National Enterprise Board


require that they should be selected from amongst persons who appear to the Secretary of State to have experience of, and who have shown capacity in, industry, technology, commercial or financial matters, administration or the organisation of workers. Does the Secretary of State have experience in any of those fields? The only job listed in Who's Who is the post held for one year—from 1949 to 1950—as a producer of the BBC North American Service. The only experience of industry he had was his disastrous tenure of office at the Ministry of Technology, when he encouraged Rolls Royce to make a contract with a United States company which subsequently brought Rolls-Royce to bankruptcy.
A major aspect of the Bill requires the full disclosure of information by designated persons or companies. It is ironic that the 1969 Edition of Who's Who should list the school of the Secretary for Industry as the Westminster Public School, which is a school of distinction. The 1974 Edition of Who's Who does not disclose that information. So much for the Minister practising the disclosure which he requires of others. Under "Educ." he has now listed "Education still in progress"—at what cost to British industry and to the workers who will find themselves without jobs?
Clause 21(1) imposes a duty on firms and individuals to give information to the Minister. However, Clause 25 provides for the confidentiality of that information so provided. What assurance is there to industry that confidentiality will be observed? How much reliance can be placed on the Minister? The last edition of The Sunday Times published extracts from the Crossman diaries. I quote one passage, which reads:
I like Tony Benn a great deal and I had every hope of him when Harold appointed him Postmaster-General. It's a queer thing but I am not very happy about him now I see him at work.
To begin with, on every single occasion when he is about to bring a plan to Cabinet a leak occurs giving the full details in advance.
What a damning indictment of a Cabinet Minister by one of his colleagues. This is a man who is asking Parliament for the most autocratic powers, unparalleled in any Western democracy. Those powers were assumed by Mussolini in Fascist Italy. The Bill seeks to centralise and to concentrate industrial and economic

power into the hands of those politicians who wield political power with such gross ineptitude. I very much hope that the House will reject the Bill. If not, when the Conservative Party is returned to power—which will not be far away—we shall repeal it.

Mr. Deputy Speaker: I appealed for short speeches. The hon. Member has taken 23 minutes. If other hon. Members take the same time, it is no good hon. Members coming to the Chair to indicate their wish to take part in the debate.

7.9 p.m.

Mr. John Garrett: I am sure the hon. Member for Stretford (Mr. Churchill) will forgive me if I do not follow his argument, althought I thought that his observations on the reorganisation of local government were interesting. I hope that the hon. Gentleman will treat the House to them at greater length in a future debate on local government. I found the hon. Gentleman's speech to be innocent of industrial experience, and therefore on the whole not worth replying to in detail.
The Industry Bill seem to represent the most important development in the industrial affairs of this country since the origins of the company law. I propose to discuss the Bill from the point of view of professional management. I was trained as a professional manager. I spent my working life in management and towards the end of my career, before coming to this institution, I was a management consultant.
I welcome the Bill on three main grounds. First, it will provide the means for making the great industrial concentrations of wealth and power publicly accountable as they have never been since the wide spread of share ownership. Secondly, it can be used to attack this country's fundamental industrial weakness which is a wholly inadquate level of industrial investment, in sectors where the need for new investment in plant and machinery is greatest. Thirdly, properly understood by management and trade unions it can change the whole purpose and activity of union-management relations from a mutually hostile basis as adversaries into a co-operative appraisal of the future of a firm and the promotion of its growth.
The Bill attempts a systematic solution of the problems of Britain's progressive industrial decline. That decline has been very long standing indeed. One of the most disappointing features about the debate so far is the way that Front Bench spokesmen on both sides of the House have leapt to their feet from time to time, each accusing the other of having caused the decline in British industry, whereas there have been plenty of objective studies on the question which shows that the origins of that decline go back a very long way.
The best guess is that it started some time between the Great Exhibition of 1851 and the Paris Exposition of 1861. One of the most acute observers of the start of the decline was his late Royal Highness Prince Albert who pointed out that in the 1850s Britain was beginning to lose its lead in the development of new products and equipment. No Government have found a solution to that progressive decline from that day to this.
The CBI and the Opposition Front Bench spokesmen on industry are allied in opposition to this measure. One of their themes is that it is in some way anti-management and attacks the interests of professional management in this country. I believe that proposition to be quite mistaken. In fact, I believe the opposite to be true.
The hon. Member for Henley (Mr. Heseltine) reminded me during his speech of the famous Confederation General Jubilation T. Cornpone, of blessed memory, who waved his sword at the enemy and shouted "Forward" but failed to notice that he was sitting backwards on his horse. The Opposition may find that management in industry, when it understands the implications of the Bill and its opportunities for management, may be heading in precisely the opposite direction.
I have not met anybody of my generation or younger in industrial management who in any way felt that the CBI had represented their views on anything. It is seen by management as a kind of conglomerate trade association held together only by a desire to resist the Government's legitimate interest in industry and to pressurise the Government to make particularly favourable financial arrange-

ments for industry—preferably by outright gift.
Few managers would dispute that the basic cause of this country's miserable economic performance over a very long period is industrial and that our industrial problem divides into three main causes: first, a low level of productive investment and productivity, which has been repeated time and again by hon. Members in the debate; secondly, a failure in what I may generally call marketing, by which I mean innovation, selling, distribution, delivery and service; and, thirdly, deep divisions of social attitudes which ensure a totally inadequate sense of common purpose in industry and an inbuilt hostility in labour-management relations.
The Bill specifically addresses itself to the problem of investment. I believe that it can also make a substantial contribution to what I call marketing and to union relations.

Mr. Esmond Bulmer: Would the hon. Gentleman add low productivity as another reason in his diagnosis?

Mr. Garrett: Yes. That is what I said earlier. I said that low productivity was a feature of British industry. Yet all studies show that the British worker works longer hours, has fewer holidays, less absenteeism and puts in more overtime than his continental counterparts. The difference between the British worker and the worker in a comparable firm on the Continent is lack of investment, lack of tools and tackle, lack of adequate machinery.
The Financial Times today points out that two paint plants in the Cowley Works of the Austin-Morris Division of British Leyland are respectively 27 and 37 years old. The motor industry generally in Japan tears down whole factories and rebuilds them on a five-year cycle to take advantage of the advances in technology, machine tools and machinery. Inadequate investment is the reason for the British worker's low productivity.
Industrial investment in this country runs at about half the level of that in other industrial countries and never seems to respond to incentives and grants, which are so generous by international standards that more than one competing country has accused us of making outright subsidies.
The Bill proposes two solutions for this problem. The first is direct investment by the NEB and the second is agreement between firms, unions and the Government on the scale and direction of investment. Both solutions seem to me to be inevitable. Some institution must be created to revive firms with worthwhile futures but inadequate capital—for example, Ferranti, British Leyland and Alfred Herbert. Some institutions must be created to search for new opportunities to widen Britain's industrial investment portfolio.
There are whole new industries for which world demand is growing fast where we have a wholly inadequate performance—for example, oilfield equipment, electronics, machine tools, packaging machinery and control instrumentation. Studies have shown that the faster the growth in world demand for a product category, the lower Britain's share of that product category is. The NEB must be in the business of creating and marketing wholly new industry if we are not to be left out of the race altogether. Given the lack of interest in management by the great investing institutions in this country, professional management will find these ideas wholly acceptable.
The Bill alters the whole concept of managerial accountability and in doing so places considerable new responsibilities upon the Government and the trade unions which are management's new partners. With the wide spread of share ownership and non-interventionist policies of the investing institutions, top management has become accountable to nobody but itself. There has been no obligation on top management to the interests of the shareholder, the community or the employee. In particular, the worker who invests his working life in a firm has had no say in the decisions which have affected his working life. That seems wholly wrong.
The Bill proposes that the State and workers should be consulted. It therefore requires of the State an industrial policy into which firm's policies can be fitted. It also requires trade unions to take a view not only on wage bargaining but on investment, employment, location, acquisition, diversification, exports and import substitution.
For the first time the Bill proposes management-union relations not on an adversary basis but on a collaborative basis. It obliges both management and unions rationally to consider the future of firms and obstacles to growth in their prosperity. I cannot imagine a better framework for good management. I am sure that professional management will see it as a valuable and beneficial development. For too long management has been caught between the trade unions, whose only concern was wage bargaining, and boards of directors—more often than not appointed for reasons other than ability—whose only concern was a quiet life. Those boards of directors have been under absolutely no stimulus to improve performance, to meet national objectives or to consult or involve those whom they employed.
From the day that the Bill becomes an Act the rules will be changed. Those rules have been as restrictive on professional management as on anybody. I see the Bill as a charter for competent professional management and I support it.

7.20 p.m.

Mr. Dafydd Wigley: Much as I should like to follow the hon. Member for Norwich, South (Mr. Garrett), having spent 10 years in manufacturing industry, I must forgo that luxury, as I have to concentrate on the aspects of the Bill relating to Wales.
This is an interesting Bill inasmuch as the hon. Member for Preston, South (Mr. Thorne) denied that it was a Socialist Bill, the hon. Member for Rochdale (Mr. Smith) denied that it was a Liberal Bill, the hon. Member for Stretford (Mr. Churchill) denied that it was a Tory Bill and I certainly deny that it is a Nationalist Bill. In the years to come it will be interesting to see who owns up to the paternity of the Bill.
It may be that in years to come all the hoo-ha which we have had will seem unnecessary. In the meantime, there are serious problems, and I speak against the background of Wales, a background where there has been a failure of the private sector to solve our problems. We have what I call a branch factory economy, an economy controlled from outside and one which does not provide the answers which are necessary in Wales today.
Many of our problems have been caused in the first place by the private sector. Speaking of the branch factory syndrome in Wales, a recent report showed that of 86 branches studied, fewer than half had any ability to make investment decisions themselves. The same report, by the Welsh Council, showed that subsidies in Wales
needed to gain head office final approval for their expenditure budget or even the actual disbursement.
Not only have we had a failure in the private sector. There has been a failure of nationalised industry to live up to its promise. We have had a history of closed pits, as Ogilvie has shown; and closed steel works, as Ebbw Vale has shown. We have had a history of closed railway lines and stations, and a history of nationalised industries such as electricity having its offices outside Wales. Not only control but management and clerical jobs are outside the country. This is true of the GPO, in Chester and Shrewsbury. Nationalisation of itself has failed to live up to the expectation in Wales not only in providing the jobs but also in involving the working people in decisions affecting their everyday lives.
There has been a failure by the Government to clarify the rôle of the NEB in Wales in its relationship to the Welsh Development Agency. I spoke to some of the senior people involved in industrial development in Wales, and they were more mystified and uncertain about the situation after yesterday's debate than they were before. Many people in Wales were under the impression that the Welsh Development Agency would undertake virtually all of the NEB's functions in Wales. We were told yesterday that this is not the case, that they would co-exist in parallel. I would remind hon. Members that parallel lines never meet.
The relationship between the Welsh Development Agency and the National Enterprise Board poses an interesting question. We believe that we shall land ourselves in an organisational mess because the matter does not appear to have been thought out. We want to know whether the NEB will undertake not to use some of its powers in Wales, and if so what powers it will not use.
Reference was made yesterday to centralisation. Centralisation can have four conditions in our economy. First, we have private industry controlled locally; secondly, private industry controlled outside Wales; thirdly, public industry controlled in Wales, of which there is very little; fourthly, public industry controlled outside Wales. We fear that this Bill, if it does anything, will move the powers over locally-controlled industry from Wales to London.
The argument can be put forward that the Bill attempts to transfer power to working people. The hon. Member for Chester-le-Street (Mr. Radice) made this point very effectively. He said that the whole question should be about power. This Bill does not transfer power to the working people. It is an excuse for that, but it does not do it. Decentralisation by central direction may be a bit of a contradiction. We want to establish a self-generative system of growth with its roots in the local communities.
When we talk of the NEB and the Welsh Development Agency we want the emphasis of enterprise. Having said that, we accept that there are many problems in the economy relative to capital formation which must have serious thought. Capital is far too valuable and scarce a commodity to be played with, like a three shilling packet of cards in that "casino", the City of London Stock Exchange. Industry needs to be organised to work effectively; capital is vital to industry, and it, too, must be organised effectively. It must be organised in its allocation and use within a company, and it must be controlled and harnessed to the needs of the community. There are some who argue that capital, if left to itself, will find its way to the right place. I wonder. Capital, I suspect, like water, will always run to the sea unless harnessed. This means channelling, damming and pumping it. It is valuable if it is where it is needed and where the community wants it to be.
I make this further point on the importance of capital to industry. Industry uses capital. It is an input, in the same way that labour and materials are inputs in industry. It has its wage, just like labour. If the risk is high, so the wage should be high; but the wage of the labourer implies neither ownership nor control, while the wage of capital, over


and above risk and depreciation, gives implied power of both ownership and control.
This is an archaic system for the last quarter of the 20th century. We need a fundamental rethink of the role of the joint stock company, which has been a vehicle for both enterprise and avarice for the past 100 years. In particular, we must think of the appropriateness of limited liability in today's world and what obligations and limitations should go with its benefits. We may question the whole working of the City of London financial institutions in this context.
There are several questions that I should like to have gone into in detail. However, there may be a later opportunity to do this, particularly if the Committee stage of the Bill is taken on the Floor of the House.
I should like to raise some questions relative to nationalisation, if nationalisation is to take place. Will it not be appropriate for at least 51 per cent. of the ownership of industry taken over by the State to be transferred to the workers in those industries?
I believe that disclosure does not go half far enough. There are vital questions, such as capacity and capacity utilisation, which should be of fundamental importance to the trade unions, which are not itemised. There are questions of compensation and whether the rights to appeal against the form of compensation should be built in.
There are questions of transfer to non-residents. There should also be the right to intervene on transfer to residents, particularly when we think of the assets stripping which goes on. There is the question of extractive and service sectors where the Bill ought to be relevant. There are questions of changes of accounting techniques particularly in allowing profit to be shown on a plant basis. All these things we shall have an opportunity to discuss in Committee. The most important matter is the question of the powers of and the links between the Welsh Development Agency and the NEB.
I should like to put a number of questions, the answers to which will decide how we vote tonight. First, is it the Government's intention to amend the Industry Act when they introduce the Bill

to set up the Welsh Development Agency, and will the Bill for the Welsh Development Agency appear before the Report stage of this Bill?
Secondly, if the NEB and the Welsh Development Agency operate in parallel in Wales, what will be the link between the two?
Third, will the Secretary of State for Wales have powers in Sections 7 and 8 of the Industry Act 1972, as stated last night by the Under-Secretary? I believe that in the consultation paper issued two weeks ago only Section 7 was mentioned.
Fourth, what proportion of the total joint activity of the NEB and the Welsh Development Agency in Wales will be undertaken by the Welsh Development Agency? The budget of the Welsh Development Agency is only £100 million over five years, compared with £500 million called for by the Wales TUC. How does this £100 million of the Welsh Development Agency fit into the plans of the NEB? Will some additional money of the NEB be spent on Wales?
The consultation paper states that the Welsh Development Agency will provide investment capital for Welsh industry. Will this come from within the £1,000 million limit set out in Clause 6 of the Bill? Does the Welsh Development Agency have the power of disclosure of information as set out in Clauses 20 and 21 of the Bill, or will this be a power only of the National Enterprise Board?
Will the shipbuilding credit provisions in this Bill be transferred to the Scottish and Welsh Development Agencies and will those agencies have sole responsibility for this function? Will the National Enterprise Board have total responsibility for both branch factories and subsidiaries located in Wales and, if so, will the WDA have no responsibility at all for such companies? If so, only one-third of factories in Wales employing over 25 people would be controlled by the Welsh Development Agency. Two-thirds would be under the National Enterprise Board. This would be totally unsatisfactory.
Finally, if the Bill is defeated, can the Secretary of State assure us that the Bill setting up the Scottish and Welsh Development Agencies will go forward since these two are apparently totally independent? There is a potential for


building something very important in this Bill. We fear its centralisation and we fear that we shall not get the tools to do the job in Wales. We shall determine how we vote following answers to the questions I have put.

7.32 p.m.

Mr. Robert J. Bradford: It is true that the majority of industrialists in Northern Ireland have great reservations about the Bill. Some of those reservations are based on the details of the Bill. For example, we could point to the clause which deals with the disclosure of information. Our main objection to the Bill concerns the overwhelming principle of State ownership and absolute control. If anyone doubts that these are implicit in the Bill, I direct his attention to Clause 2(3), in which specific cases are cited and in which it is said that State assistance and State intervention are required to stabilise industry, together with intervention, advice and supervision.
That is quite a different matter from the enforcement of a Socialist policy of ownership and dictatorship in industry. We cannot argue from the particular to the general, posing the theory that because State assistance and intervention is beneficial in one or a number of specific industries, all of industry would be the more healthy under its oversight and ownership.
It is true that Northern Ireland benefits greatly from State intervention and assistance. It would be remiss of any Northern Ireland Member to ignore that fact. In spite of all the help and assistance that has been awarded to Harland and Wolff, and the aircraft industry, if this Bill had been in existence when many of these industries were seeking new sites for their plants, or if this kind of legislation had been mooted then, I fear that that kind of investment would have been greatly deterred.
Northern Ireland has benefited greatly from outside investment. That is especially true of the textile industry. Although there is a general slump in the textile industry, the great investment which is projected in industry is invaluable and vital to the economy of Northern Ireland. For this reason, it would be greatly detrimental to the economy of Northern Ire-

land to allow the principle of State ownership to deter much-needed investment.
It is true to say that not even members of the European Economic Community would envisage State control to the extent envisaged in the Bill. Investment is the very life-blood of industry in Northern Ireland, and I am quite sure that that obtains for industry in the United Kingdom too. This is precisely what this Bill would deter.
It has been suggested that the Northern Ireland Finance Corporation is a forerunner to the National Enterprise Board. It is inaccurate to equate as neatly as this the Northern Ireland Finance Corporation and the National Enterprise Board. The Northern Ireland Finance Corporation could better be described as a kind of banking or borrowing source, but with no undue control over the companies which benefit from its resources. The National Enterprise Board is rather different. Firms would not readily use that organisation, because of its stipulations and all-prevailing powers, including the disclosure of future plans, the disclosure of investment, and the method of distribution of products, all of which could be exploited by trade unionists and competitors.
Willingness to meet competition and a desire for self-determination are the twin pillars upon which most successful industries are built. Alongside these two qualities is set the responsibility of a realistic Government to appreciate the contribution of such industrial achievement. The combination of competition, self-determination and Government assistance would assist industry. In this kind of co-operation there is the formula for a successful economy.
The Bill is not the kind of legislation which will achieve the industrial unity which is needed at this time between management and workers. It is also not the kind of legislation that will encourage national unity, without which I believe we shall have very little economic future.

7.37 p.m.

Mr. Ron Thomas: The hon. Member for Belfast, South (Mr. Bradford) will forgive me if I do not follow him along the road of his argument. It is a little difficult to follow two Nationalists. They have raised pertinent


questions on Northern Ireland and Wales. I am sure that some of these at least will be answered by the Government Front Bench later.
I welcome the Bill. If it were the kind of immediate, dramatic, Socialist measure which the hon. Member for Belfast, South suggested and which has been suggested by many Tory Members, I would welcome it with even more enthusiasm. It is quite amazing what has been read into the provisions of the Bill.
My right hon. Friend the Secretary of State for Industry yesterday laid down three prime objectives. He spoke about attempting to reverse the long-term decline in British manufacturing industry by providing a new source of public investment. He spoke also about injecting national and regional accountability as well as accountability to workers in terms of strategic decision making. He spoke about the extension of industrial democracy. Some hon. Members, quite rightly, have raised the question of the industrial malaise from which we are suffering, and many hon. Members have attempted to give their own diagnosis of the reason why this has happened and why it continues to be with us.
I do not think anyone could deny that to a very large extent it is due to a lack of capital investment—a failure to modernise our productive resources, and a failure, in my judgment, to harness the skills and energies of the working people of this country. It is true that the low level of capital investment in Britain is no new phenomenon. It has been with us, as my right hon. Friend has said, for decades.
The statistics for the proportion of GNP invested in British industry show that we come way down in the league table, if not at the bottom of it. We are all familiar with the fact that it has recently been estimated that the amount of capital equipment available to workers in Britain is only half the amount that is available to French, Japanese and American workers. The level of capital investment and capital equipment is far lower in this country than in Germany and in most of our competitor countries.
We tend to throw out statistics and ignore the fact that we are talking about gross domestic capital formation, and about gross figures, and that these have

to be adjusted for capital consumption. It is the net figure that is important. It is the level of new investment which takes capital consumption into account. It is from the net figure that we hope to achieve further economic growth and increase our competitiveness. The level of capital investment has to increase merely to enable the capital stock to stand still.
It is my belief that there has been a failure effectively to utilise the capital investments that has been injected into British industry. There has been a tendency to go for capital widening, rather than capital deepening, merely inefficiently adding on to and replacing in the same old fashioned way the sort of capital replacement in the capital widening sense rather than in the capital deepening sense which demands the use of numerical control machines, computers, feedback mechanisms, and so on, which our competitors have installed.
The record of capital investment in British manufacturing industry has been dismal over many decades, and we have been given a number of reasons for this. We have been told by Conservative Members that it is due to the high level of taxation, or at least to the fact that the level of taxation on companies in Britain is higher than it is in competitor countries. It is true that if one takes certain selective examples one can show that there is a high level of taxation, but it must be remembered that no industrialists in the world have received such generous capital investment allowances as those which have been provided for British industrialists. On many occasions the House has been given details of Government assistance to private industry. It has been running at about £800 million a year, and in my judgment the capital investment allowances of all kinds and other forms of Government assistance more than offset the difference in terms of tax between this country and our competitors.
In 1970, the level of capital investment was just over £2,000 million a year. Throughout the period of the Tory Government, the level of capital investment fell. It has been said many times during the debate that the only constructive proposal which Conservative Members have is to go back to the old notion of


setting industry free. In 1970 the Conservative Government began by deciding that they would, as they put it, set industry free. They provided massive tax relief, but we then had 1 million unemployed. They introduced the Industrial Relations Act, a 20 per cent. devaluation and a wage freeze to boot, but still the level of capital investment declined.
In addition, we were told that membership of the Common Market would provide such a competitive blast across the bows of British industry that entrepreneurs would fall over themselves to invest and to modernise in order to meet the competition from Europe. The reverse was the case. The level of capital investment continued to decline, and all we got was a kind of enigmatic smile on the unacceptable face of capitalism.
British industrialists managed to find £1,300 million in 1972, and nearly £1,400 million in 1973, for capital investment overseas. Plenty of capital was available for investment in land, in property speculation and for speculation in commodity markets, but none for investment in British industry.
The hon. Member for Henley (Mr. Heseltine) described corporate planning as a vague extension of an understanding of what might be but would never be put on paper by management. I am a little concerned about this, because it supports my judgment that there is far too little planning in British industry. There is far too much of going by hunches and putting the employment of workers at stake as a result.
The hon. Member for Bridgwater (Mr. King) rightly reminded us of the gestation period of capital investment. He interrupted a number of my hon. Friends to say that it takes three or four years for capital investment to come on flow. I do not disagree with that, but is there not planning at the start of those three or four years? Is there any market research to determine whether the capital investment should go ahead? If there is, it is something in which workpeople ought to be involved.
Then there is the whole question of secrecy. The suggestion is that these decisions are made now as they were by the heroic inventors of the nineteenth century. The suggestion is that these

are innovating entrepreneurs who closet themselves together and come to these great decisions which will increase their competitiveness, and if anyone finds out what they have decided all their efforts will be wasted.
If one discusses this with people in the machine tool industry they say that, generally, capital investment decisions are bunched together and they all go forward together. If the Vauxhall Motor Company decides that it will expand, or if BLMC makes such a decision, the other car firms follow suit. I refute the suggestions that if these so-called secrets were divulged the competitiveness of these firms would come unstuck.
There is a need for a fundamental regeneration of British industry. I do not recall my right hon. Friend saying that this would be done "at a stroke". I took him to say that the Bill was a vehicle by which the regeneration could begin. No one doubts that £700 million is no great fortune in this day and age, in terms of capital investment, and we have been told that this sum will last for a number of years Capital investment in manufacturing industry now totals more than £2,000 million a year, so with a figure of about £700 million we are talking about less than 3 per cent. of the total over 10 years.
It has been said that the success or failure of the legislation will depend to a large extent on whether management and trade unions accept the challenge presented by it.
I have one or two points to make on the Bill itself. The Opposition have said that in Committee they will try to remove various provisions from the Bill. Many of my hon. Friends have said that if they are on the Committee they will want to strengthen this measure.
I welcome the concept of Planning Agreements. I should prefer far more power to be given to the Secretary of State to bring about these Planning Agreements and to make certain that firms enter into them.
We should combine the price control mechanism with the mechanisms in the Bill. Recently we were told that prices would have to be increased to allow for capital investment. It now seems, as many


of us have suspected for a long time, that it is the consumer who pays for investment through increased prices. If consumers have to pay for capital investment, the only way to secure accountability is through the NEB.
If planning agreements are to remain in this restrictive setting the Bill's provisions on the disclosure of information must be strengthened. The information required under Clause 21 suggests an almost post mortem approach. Subsection (4) injects some life into that approach, and that is where I hope the emphasis will be placed. Unless the information is dynamic in terms of company planning and forecasts of developments in those companies we might just as well make do with last year's balance sheets. The required information should contain details of pricing policy, marketing strategy, research and development on new products, and so on.
The disclosure of information to trade unions is not enough. Information is power, but there will be a need to stimulate and develop an active involvement of workpeople in this area. At the moment, on the basis of so-called managerial prerogatives, management refuses, by and large, to involve working people in affairs which concern them and to which they have a significant contribution to make. They have a contribution to make on the question of capital investment—the kind of machinery which is purchased. How often have we gone into factories and seen a machine which has ain idle for two years and been told by workers on the shop floor that it was obvious to them that the machine would never be used? Workers have a contribution to make on such things as investment, capital equipment and factory lay-out.
This can come about only with an extended system of joint regulation. We have talked a lot about joint consultation, but in British industry it is a dirty word. It is a charade, where two sides get together for a couple of hours and talk about the canteen tea and the state of the toilets. That is not what the legislation is all about.
A good deal has been said about the question of whether or not the legislation will be affected by decisions in the EEC. It is strange to hear Conservative Members making so much play about the

denial of parliamentary accountability and sovereignty over the Bill when they are so willing to bend over backwards to give up the sovereignty of this House to Brussels. That is a political schizophrenia which I cannot understand.

Mr. Deputy Speaker (Sir Myer Galpern): I know that repeated requests have been made from the Chair this afternoon inviting hon. Members to be as brief as possible. The concluding speeches begin at 9 o'clock. That leaves one hour and five minutes in which 10 hon. Members wish to participate. A great deal can be said in five minutes.

7.55 p.m.

Mr. Kenneth Warren: I hope I shall be able to comply with your suggestion, Mr. Deputy Speaker. I have been in industry for 20 years and I am still there. I look forward to taking part in the Committee stage of the Bill, which was launched yesterday with much verbosity and pomp by the Secretary of State. Reinforced by his hon. Friends, he claimed that his aim is only to help British industry. I claim that the Bill is the means of turning this country into a Marxist Socialist State and that it is but a catalyst to achieve the right hon. Gentleman's aims.
The Secretary of State and his hon. Friends may persist in this claim, but it is easy to demonstrate that the £1,000 million addition to the country's investment programme spread over the life of the Bill will scarcely scratch at the problem of under-investment. In 1972 private industry spent £4,300 million on investment in fixed capital equipment. The sum of £1,000 million spread over several years would not go anywhere. We therefore have a Bill which is designed to enable the Government to buy a controlling interest in key companies which have been kept short of cash by the Chancellor of the Exchequer. We have to accept—although I do not appreciate the fact—that the Secretary of State has never worked in industry. This lack of shop-floor experience shines out of every clause.
The right hon. Gentleman has been very strong on democracy and participation but he has not shown that he knows how industry works. He talks only of an industrial world which exists east of the Iron Curtain. Perhaps I am doing him


an injustice, but we need a clear declaration from the Minister of State tonight that the Government do not intend the sort of Marxist Socialist transformation of society which is implicit in the Bill.
The right hon. Gentleman spoke about mandates, but he has had no mandate from the British people to carry the Bill into law. His attempts at consultation have been misread, not only by himself but by his colleagues. He said yesterday that the Government would seek to win active support for their policies. So far they have failed. Perhaps it would be a good idea for us to have a progress report on his consultation, and I should like the block votes kept out of the records. Yesterday there was confusion during the shop-floor consultation on the Treasury Bench when the Minister of State had to ask his convenor whether or not the information on Government loans should be made public. This might have been good enough for a laugh at the time, but it showed the tragic lack of understanding of what goes on in the Department of Industry at a time when the Department is claiming to be able to transform British industry.
Is it suggested that the Government can legislate enterprise and efficiency into industry? If it is, it displays a scandalous lack of understanding of the way in which British companies are run, and how they hope to survive in the world export markets. The Secretary of State offered neither recognition of the achievement of those companies nor praise to the workers who gave us those achievements. One has only to probe gently into the Government's statistics to illustrate the effect of government on industry and to understand that it is not industry that needs government to survive but the Government which needs industry to support it.
Between 1964 and 1974 the level of so-called Government aid was put at £5,450 million. That included the change from investment allowances to investment grants. The latter failed to benefit half the industry of the country. In my constituency in the last 12 months unemployment has doubled, yet we qualify in no way for Government aid, and the Bill offers no help. Mine is not the only constituency with such a problem. The

total aid figure included REP and involved many loans and agreements from which the Government could not only draw interest and capital but could recover a percentage of the revenue on sales.
Between 1964 and 1974 industry paid £18,300 million in tax. The bright stars of Socialist Britain, the nationalised corporations, had an entirely different record over the same 10 years. They paid £98 million in tax and lost £360 million. The national expenditure and incomes blue book states that in those 10 years the State enterprises received nearly £1,700 million in subsidies and we had to write off debts of £2,410 million. Now we are invited to help the State participate further.

Mr. Mike Noble: I do not know whether the hon. Gentleman has read the Conservative election campaign guide, but if he turns to page 113 he will see that his party was boasting that it held down the prices of nationalised industries deliberately, and turned them into loss makers in order to sustain some measure of price stability. Perhaps he will mention that in his speech when talking about writing off losses, because it was done by his Government for four years as a deliberate act of policy.

Mr. Warren: That does not deny the fact that these figures are correct. The nationalised electricity industry is to put up prices by over one-third in the next four months. We must face the reality that nationalised industries have never produced any goods or services better than private enterprise. If they are so good, why do they run into so much trouble? From within the Department of Industry we have been given a sour revelation of the taste of things to come. I accept that these statistics which I have given have already been disputed, but they are there. They are the Government's statistics, and the Government must sort them out.
The experience of private industry of the kind of help the right hon. Member for Bristol, South-East (Mr. Benn) is inclined to give can be seen in two examples of his intervention during the Socialist Government. There was the wonderful £25 million loan which he gave from the IRC to Leyland in order to carry


out the merger of that company with the British Motor Corporation. We have seen the results of that. Secondly, he was the man who organised the fixed-price contract on the RB-211.
The problem which Socialist back benchers face on the Bill is that it is not a matter of power to the people at all. It is power to the Secretary of State. The Webbs, the Laskis and the Daltons will be turning in their graves. The power the right hen. Gentleman seeks is power for himself. Under Clause 2 the National Enterprise Board is said to be able to do anything necessary for performing its function. Who decides what is "anything"? Who decides what is "necessary"? Clause 6 says that it is the Secretary of State. If companies do not do as he says, if the National Enterprise Board, does not do what is required of it, there is no need to get new chaps, as is the case with the Industrial Development Advisory Board. Clause 3 says that the Secretary of State will direct the Board, and I bet he will.
We have the famous mushroom treatment: British industry is once more to be kept in the dark and covered with Socialist fertiliser.
What power can the Secretary of State actually use? Clause 8 says that he can buy a maximum 30 per cent. of the shares of a company. We should compare that with Clause 15, by which he amends the 1972 Act, removing the prohibition on the Secretary of State's acquiring more than half the equity share capital of any company. The right hon. Gentleman can tell companies how high to jump and in which direction to run, no matter how lame they may be.
The Bill is a dangerous inroad into the ability of industry to survive. Clause 10 states that the Secretary of State, if he considers that an important manufacturing industry is seriously and immediately threatened with a transfer of control, has the way wide open to help himself to it. Under the clause he can vest the capital assets of the undertaking not in the people, not in the Government, but in himself. The condition is only that of national interest. Who decides what the national interest is? I am sure that everybody has guessed by now. It is the Secretary of State.
This drab Government is once again trying to dull the competiveness and will of British management and British workers. Companies are now finding that in order to survive they have to compete not only against others in the export markets of the world but against their own Government.
The crazy chaos of industrial aid was revealed yesterday when the Peterlee Corporation proudly announced that it was receiving Government aid to encourage a Japanese ball-bearing company into this country, bringing foreign equipment which would receive a State subsidy. Yet British ball-bearing companies do not qualify for such aid because the equipment is already here.
The heart of the danger to British society is that we have a Government who do not care about industry or are so confused that they will wipe out British enterprise under the weight of bureaucracy to come. It is no good the hon. Member for Liverpool, Walton (Mr. Heffer) saying that this is stupid. This is the way it is.

Mr. Heffer: The hon. Gentleman is stupid.

Mr. Warren: That is a matter of opinion which I am always ready to debate with the hon. Gentleman, but he is no longer on the shop floor, and it is not a question of "I'm all right, Jack".

Mr. Heffer: Opposition Members should understand the position. On the one hand they say that they want inward investment, which the Government are very willing to have. On the other hand, when an attractive outside company gets the benefit of assistance in an assisted area, they say that our own industry is not getting it. They cannot have it both ways. Either we want to have inward investment and to attract outside companies into the development areas or we do not. That is what I meant when I said that the hon. Gentleman does not understand the whole question.

Mr. Warren: There must be some control over the invitations to foreign companies to come into this country to compete against our own companies. Why do we subsidise them? It is ludicrous. There is no control in any clause of the Bill over the multinational companies which Labour Members dislike so much.

Mr. Leadbitter: rose—

Mr. Warren: Other hon. Members want to speak, so I shall not give way.
If I am one voice on the Opposition benches speaking out on the matter, I believe that I am also expressing the wishes and views of the vast majority of our people, including the workers on the shop floor, who do not believe that the Bill will help them. The trails of dictators are littered with fables that their brand of dictatorship is in the national interest and will be for the good of the people. The Bill bodes no good for the people of Britain. It is a bid for the takeover of their way of life.

Mr. Deputy Speaker (Sir Myer Galpern): I agree with the hon. Member for Hastings (Mr. Warren) that there are other hon. Members who want to speak. We have already had the first casualty.

8.8 p.m.

Mr. John Watkinson: The hon. Member for Hastings (Mr. Warren) will not be surprised if I do not join in his extremist response to the Bill. It was typical of the Opposition's response, in that it was not constructive and was highly personalised. In personalising the debate, Conservative Members have debased it.
The hon. Member for Henley (Mr. Heseltine) told us yesterday that all political parties had failed in the matter of this country's industrial performance. I agree. Does not that show that now is the time for a breakthrough, for the regeneration of British industry? It is a commonplace that as a nation we have fallen behind our competitors. We are growing at a rate of only about a half to a third that of our European neighbours. Whether we take statistics about levels of personal income, housing, education or anything else, we find that we are behind our Continental neighbours.
The reason we are behind is that we have failed to grow as a nation, and because we have failed to grow we are unable to pay ourselves the wages which we desire and to provide ourselves with the goods and services which we demand. Because of our failure to grow economically, our wage increases have been whittled away in rising prices, and be-

cause we have attempted to pay ourselves so much more than we can actually afford in these last few years, our real standards of living have not grown significantly.
We have, therefore, a situation of low economic growth coupled with high unit costs of labour, and this has been brought about—as many speakers on both sides have said in debate—by our failure to invest. The fuelling power for economic growth is investment and our performance has been particularly disappointing over the past five years. I see that the figures from the DTI, and, indeed, those from the CBI, indicate a pessimistic trend in investment. We are now in the position of consistently under-investing by 10 per cent. in relation to our European neighbours.
The reasons for this under-investment have been discussed at some length in the House. We have had mention of Government policy, the stop-go policies of previous administrations, monetary policies which have led to high interest rates—which has meant that industry has not been able to borrow—the failure of industry to respond to the multifarious offers which have been put before it by successive Governments, and a failure in the quality of our management, but I would point to one area which I think is of significance, namely, the failure of our financial institutions.
I refer to the City of London. On the Opposition side of the House the City is regarded as a sacred cow; on our side, I would say that it is an institution which has escaped much-needed reforms. I quote from the Hudson Report, which says:
We are struck by the disastrous effect of the City of London on the British economy. Without discussing the ideology of the City, it is clear that it has preferred to nourish foreign enterprise rather than feed or renew the sady depleted infrastructure of British industry.
The City is a 19th century institution. It is an institution which nurtured the world. It provides and has provided investment for foreign nations when we in this country need the investment for our own industry. It has been said that if the City is unable to channel that investment into British industry then it should be directed so to do, and those are not the words of some extremist Marxist, those are the words of Sir Fred Catherwood.
It is time, too, that our banking institutions reformed themselves. Why is it that banking institutions in this country still lend short? They will not fuel British industry in this country. We have a situation, as I have indicated, in which rates of interest have remained high. Under the Finance for Industry provisions, because of the high interest rates it has not been possible for the pick-up to be as great as might have been hoped. Perhaps it is time to consider a situation in which we have a two-tier interest rate system comparable to that of the French.
To deal with the breakdown in British industrial growth and industrial investment we have brought forward our Industry Bill, which in my opinion is vital for the regeneration of British industry. When papers as diverse as The Times, the Sunday Times, and Tribune can agree that this country needs a further £20,000 million invested in the next few years, perhaps those views are worthy of note.
The Conservative answer to this, from what has appeared in their arguments, is that we should rely upon the operation of the market to supply up with these funds. But what has been the record of private enterprise in the past 15 years? In the words of the Economist, lamentable
Let us recall those golden days of Selsdon Man, when British industry was to be set free and our opponents backed their words with actions. They released credit from the banking system on to the financial markets. And where did the money go?—into productive enterprise? No. It went into fuelling a property boom, a stock exchange boom. It did not go into productive enterprise.
Where is the evidence to suggest that the market system will provide for the vast increase in dustrial investment which this country needs? If we look at our continental neighbours we do not see that they rely upon the working of the invisible hand to provide that investment. It is noticeable that France, with its enviable growth record, has 500 firms under State ownership, including banks and insurance institutions. Sweden has its Statesborg. Italy has its IRI. In Germany, the commercial banks are closely linked with industry. We are one of the very few countries which lack an active Government involvement in industry. Hardly

anywhere in the world, barring America, does the law or opinion accept that Governments and representatives of the public should get on with their jobs and leave those who manage industry to get on with theirs.
Far from being a revolutionary proposal, the Industry Bill follows the lines laid down by the Tories in their Industry Act 1972 and the experience of countries on the Continent. Through the operation of the National Enterprise Board there will be a channelling of vital investment funds into British industry. One read yesterday that Lord Stokes, at the meeting of British Leyland, indicated that that company at a crucial time, was unable to borrow funds from the banking institutions of this country in order to finance its investment programme. Lord Stokes has said that companies of the size of British Leyland can no longer be expected to exist without active Government intervention.
But there are other aspects of the Bill to which hon. Members have drawn attention. Through the operation of disclosure, trade unionists will benefit. We are introducing into British industrial life a measure of industrial democracy. All parties in this House are in favour of some measure of participation, yet when we bring forward constructive proposals, this being a conservative nation, there is a scream of anguish from the other side.
As the Economist has said, firms in Germany and Austria are already required by law to make much of the disclosure that is now turning the hair of British management grey.
Can we really go on with a situation in which working people can be the last to know about matters of vital importance affecting their work and their livelihood?
One of the benefits of the Bill is that through planning agreements and disclosure, there can be as significant effect on the quality of investment in this country. Perhaps the investment policies of previous administrations can be criticised on the basis that they have not been selective enough, that they have been too sweeping in their nature. I would have thought that, given the operation of this Bill, by which selectivity may be introduced, it could have some appeal


to hon. Members opposite. What is certainly the case is that for the next decade British industry is going to have to make some painful decisions about its investment potential and about those industries into which investment should go.
In these circumstances, it is vital that the work of the Manpower Service Commission should be significantly increased. The total expenditure and the services provided by that organisation are totally inadequate in the present circumstances. In any given year at present, two-fifths of the young labour force coming on to the market is not being trained industrially. This compares woefully with figures of 70 per cent. in Germany and Sweden.
To say that we have an investment crisis will have no effect upon the public at large. We politicians have tended to devalue the currency of that term. But major reforms are needed, especially in investment, and these reforms will be provided through the operation of this legislation.
The Opposition claim with all the conviction of nineteenth century dinosaurs that they will repeal this measure. However, the Bill will take us forward. There is no going back to the laissez-faire economy of the nineteenth century. The Bill extends to British industry an area of democracy. I believe that it carries the full-hearted support of all Government supporters and of most of the British people.

Mr. Deputy Speaker: There goes a second casualty!

8.22 p.m.

Miss Harvie Anderson: I am glad to have this opportunity to express briefly the widespread concern shared in Scotland at what we believe to be a bad Bill. When Government supporters say what a splendid Bill it is and how mild it is, it is interesting to hear them go on to emphasise how much more strength they would like to see in it. That does not encourage us to overcome our mistrust of it. What is more, the mistrust in Scotland has not been reduced by the experience of nationalisation there or by intervention in difficult circumstances.
This seems to be an extraordinary moment for the Secretary of State to bring

in this Bill in answer to his charge against private enterprise for its lack of investment. We need more investment. No one doubts that, unless it be a Government supporter who spoke earlier, to whom it appeared to come as a new thought. British industry has had drawn away from it all possible sources of investment, with the result that it is now at a point where only survival can be thought of. The Government have seen to it and are seeing to it that there is no money left to save and therefore no money left to invest.
A number of hon. Members have referred to the better investment records of other countries. I think that it is time that we remembered that nearly half of what industry gains is taxed away in one form or another. That is far more than in any other country. None of the countries which have been mentioned—Sweden, Western Europe or Japan—is in the position in which British industrialists find themselves. In addition, we are living in times when inflation is running at the highest rate ever experienced in the country.
We have heard little mention by Government supporters of the factor of confidence, yet confidence has been so badly shaken that potential shareholders, whether they be small shareholders or pension funds—those whom I describe as "the big boys"—shy away from investment altogether. I cannot resist bringing to the Minister's notice the fact that in recent times British Rail has invested in pictures. It has entered the antiques market. I hope that the Government will consider seriously what happens when a nationalised industry buys pictures as a form of investment, bearing in mind that anyone buying a picture may make a shrewd buy but that no matter how shrewd it may be the money invested in it is sterilised.
The Bill is claimed to improve upon this situation, which undoubtedly it will not do. I suspect that its purpose is further to undermine the accepted structure of our society, and, in the process, to extend State ownership.
I shall not go into the details of the powers, which we consider to be far too great, for the National Enterprise Board and for interference in companies which are profitable as well as those which are


unprofitable. In the case of profitable companies, this measure can only exaggerate the uncertainties of the present, and those companies which cannot keep sufficient of their profits to invest are ripe again for State ownership, through no fault of their own.
I want now to make one or two points about the clauses in the Bill. Clause 2(3) contains the words "anything" in line 42 and "or elsewhere" in line 43. I hope that careful consideration will be given to what those words mean. It may be that we shall be told at a later stage what they mean. But how wide is the scope of them, and does the word "elsewhere" apply to British companies which have works in, say, Turkey, Western Europe or South Africa, and how would the NEB be able to exercise its powers in those places.
I come, then, to Clauses 9 to 11. I cannot understand why the Government propose to duplicate existing powers. As I understand it, assets cannot be transferred without Bank or Treasury agreement—or is the intention simply to press harder on companies seeking to make such transfers?
In Clause 13, dealing with compensation, we have a series of provisions indicating how compensation shall or may be given. There is a great difference between "shall" and "may". I should like to know who gives the "may". I suspect that it is the Secretary of State, and that does not fill me with confidence, either.
In line 16 of Clause 14 we find the phrase
… being an arrangement entered into".
What does that phrase mean, and has such an arrangement the force of law? To our industrialists, the interpretation of the phrase means a great deal.
Finally, but by no means least in importance, how does the power of Parliament rate in this widespread bureaucratic structure which is being set up to suck in countless companies, whether successful or unsuccessful, at the whim of a board which is not answerable to Parliament? It has always seemed to me that, with the power remaining here to raise taxes, the power as to how they are to be spent slips further and further from us.
I do not intend to express at length my view of what has happened in the past on Clydeside when the Secretary of State has been there. He goes there when there is trouble, but we know that he has been the cause of much of the trouble.
The Bill will be resisted by the Opposition, by industry and, contrary to what some Government supporters think, by many far-seeing workers in trade unions and on shop floors. It fails either to understand the problems that we face or to set out an acceptable solution.

Mr. Deputy Speaker (Sir Myer Galpern): May I offer my congratulations to the right hon. Member for Renfrewshire, East (Miss Harvie Anderson)? Women seem to be in the ascendancy. The right hon. Lady has set a shining example by the brevity of her remarks.

8.30 p.m.

Mr. Mike Noble: I am grateful for catching your eye, Mr. Deputy Speaker and I promise to be equally brief. When I considered the White Paper "The Regeneration of British Industry" and then the Bill, I turned to text books on the operations of capitalism. The first was written by Andrew Schonfield—"Modern Capitalism"—about 10 years ago. In many ways it is a textbook description of the capitalist economies of Western Europe. One point becomes clear in reading that book—that even 10 years ago many of the economies of Western Europe had facilities and machinery of the type that we are now seeking to introduce on this side of the House in order to ensure that they obtained the economic growth.
The second set of books that I turned to—and there are a number of them—were written by Kenneth Galbraith. It is interesting to read from his latest book how he has finally come round to the point of view that the proposals which the Labour Government have for British industry are exactly right. In fact he would approve of them for the United States.
There are many things that one could say about the Bill. As a Member representing one of the most neglected parts of this country, North-East Lancashire, I could say a great deal about the regions. I take every opportunity to criticise both my Government and the


previous Tory administration for the way in which that area has been neglected. But in view of the time I intend to leave that.
There is a great deal that could be said about investment. I shall be very brief on that point because I know that other hon. Members have said a great deal about it. One point I would make is that the strike of capital, in terms of investing in British industry, that we have witnessed over the last few years—the last four years, in fact—has been far more damaging than all the labour disputes that we have had since the General Strike in 1926. We have had a very low proportion of the gross domestic product reinvested in British industry, despite all the inducements that the last Labour Government gave and that the previous Conservative Government gave, particularly after the Industry Bill.
We have also had misdirected investment. We saw between 1970 and 1974 the biggest property boom, not in housing—we saw that collapse—although workers needed houses, but in properties, in places such as the centre of London where there is a quick buck to be made for the friends of the Opposition.
Finally, we saw the greatest export of capital that this country has ever witnessed. In fact, the Hudson Report, which I would recommend to the Opposition, had this to say about the export of capital:
The comparison between investment and earnings abroad supports the argument that Britain not only is not profiting from foreign investment but is also investing abroad beyond its means".
This, to many people on this side of the House, has been obvious for many years. I hope that my right hon. Friend, the Secretary of State for Industry, will impress upon the Chancellor of the Exchequer the need to ensure that investment that is available in this country secures jobs for British workers and is not allowed to flow abroad.
The main point that I wanted to deal with concerns industrial democracy. I welcome the Bill on many grounds but particularly on the ground that it includes an element which will enable industrial democracy to flourish in those enterprises controlled by the NEB. I am

particularly pleased that the subsection of Clause 2 which deals with this does so in very general terms.
We witnessed last Thursday, in the debate on the motion that was put forward by the Liberal Party, the Liberals' prescription for industrial democracy. What hypocrisy to suggest that any of us sitting here can lay down guidelines for industrial democracy! Democracy is a seed which may grow into a flower and flourish or into a tree and bear fruit. But we cannot guide it from this House. We can plant the seed by creating the environment but what we must ensure is that the employees—that is, the workers and professional managers, who seek a release from the constraints of their present employers, very often because they are being prevented from exercising their professional skills, together with the workers on the shop floor—can develop a democratic structure within the confines in which they work and ensure that in the end they secure a substantial measure of control.
My hon. Friend, the Member for Kingston upon Hull, East (Mr. Prescott), today has had a Lobby of several hundred of his constituents who have been in a situation with the Imperial Typewriter Company where they were faced with an immediate closure, and they had had no prior information that that was to take place. Industrial democracy and the release of information go together. We cannot prescribe industrial democracy but what we can do, what the Bill lays out and what my right hon. Friend has said he will do is to consult in order to get the correct measure of release of information. These are the things we can do. We can ensure that the situation that faces my hon. Friend's constituents in Hull does not recur. I see as the key element of the Bill this question of the release of information and the associated development of control within the company, as opposed to absentee landlords who, perhaps, never see the company in operation.
It is a positive challenge to the trade union movement. Many of us—I was not a Member of the House at that time—saw what happened when the trade union movement was challenged in 1971 by the ill-thought measure, the so-called Industrial Relations Act. Operating within the law, the trade union movement


carried out a programme of education of its members. Schools were held throughout the country. At the end of the day, hon. Members now on the Opposition side of the House were saying "For God's sake let us repeal this Act". It became a millstone around their necks. That was a negative challenge to the unions.
I suggest that here we have a positive challenge to the workers of this country. They must accept the responsibilities that this measure brings. They will need training. But let us be quite clear about this: as has been said, there are many workers in British industry who know far more than any management about the bread and butter issues of the shop floor. Now we are giving them an opportunity to raise their sights.
I hope that my right hon. Friend the Secretary of State will approach the TUC and will recommend that it organises a massive programme of education so that people know not only what the Bill means but exactly what is meant by a balance sheet. Many shareholders never get the kind of information which they are supposed to have—and they are supposed to be the owners of industry.
Not only should we have schools for shop stewards and workers, but perhaps the TUC could extend its ambit and include, in its schools, members of management and civil servants, so that we could have a joint working relationship from the grass roots upwards in order to make sure that the information which will become available is used effectively.
One final question worries me. I can see the situation in which we have strong trade unions being efficient and able to use the information given to them for the benefit of both employees and the consumer. But I am worried about the situation in which trade union are weak. I should like my right hon. Friend to address his mind to that problem. What measures does he foresee in circumstances in which unions do not have either the strength of some of the larger organisations or the facilities in terms of background research to make sure that they can take advantage of this measure of industrial democracy?
I live in an area in which the industrial revolution was born from the cradle—if

I may so put it. That area, Burnley, needs regenerating. It has been degenerating since 1911. That is the town in which I have my home, but it is not my constituency. Burnley was the largest weaving town in the country. One can see the effects of degeneration over the long term. That is not a reflection on my hon. Friend the Member for Burnley (Mr. Jones) or the Burnley local authority, who have done a marvellous job. One can see the same effects in my constituency.
I warn the House that if we do not make radical improvements and changes—and provision for these is included in the Bill—many other parts of the country, including some of the more affluent areas represented by Conservative Members, will face a similar situation.

8.39 p.m.

Mr. Hal Miller: In deference to your request for brief speeches, Mr. Deputy Speaker, I shall try to cover only the main point I wish to make. In so doing I wish to bring out what I have found in common among hon. Members on both sides of the House, because it is a serious problem with which we are confronted. I shall endeavour to avoid speaking in any fractious or partisan spirit. I wish to take up some of the points made by the hon. Member for Chester-le-Street (Mr. Radice).
The Secretary of State, in introducing his Bill, said that it was no longer a question whether the economy was managed, but in whose interests it was managed. If we return to the question of who has been managing the economy, and the results of that management, we may find for ourselves a fitting humility. My hon. Friend the Member for Henley (Mr. Heseltine) pointed out that part of the reason for the poor performance of British industry, which on both sides of the House we have been lamenting, has been the political failure of both parties, excessive interference by Ministers—on which several chairmen of nationalised industries have given evidence—and the short time scale on which Governments habitually operate compared with the longer investment time scale of large concerns. I hope that that matter will be considered fully by the Government in connection with Planning Agreements.
The right hon. Gentleman also postulated the possibility that under present arrangements even the Midlands would be declining into a depressed area. I have several times raised in the House the question of policy regarding the issue of industrial development certificates for the Midlands. That is one of the main factors that has been impeding investment. That is a further illustration of the way in which Governments have impeded investment in this country and the damage to confidence that has been caused by Governments' ill-considered actions.
My hon. Friend the Member for Bosworth (Mr. Butler) mentioned confidence, as did the Secretary of State. We have heard about harnessing the confidence of all the British people. It is also necessary, apart from internal confidence, to gain the confidence of the international investors if we are to receive the benefits of new technologies as well as the finances of which we are in need.
I am worried about the bogus air of certainty that is given, in particular, to the provisions regarding Planning Agreements and the establishment of the NEB. It seems to be suggested by some Labour Members that these acts of themselves will inevitably lead to the dawn of the new era for British industry. I take issue with the Government on their finding that Planning Agreements should be concluded with individual firms. Surely we must approach the sectors first and reach some conclusion before proceeding to the individual industries.
I can see great damage to some industries if Planning Agreements are concluded with individual firms without some conclusions being reached for the sector as a whole. The motor industry has had long experience—since the original Treasury working party in 1967—of sectoral studies. A suitable framework for such studies has been found in the NEDC. The will-power to impose, if necessary, the solutions that have been clearly identified has been missing. British Leyland is obviously a case in point, the history of the matter going back to the original IRC merger.
If we consider the motor cycle industry as a sectoral study—I have been able to engage the Minister of State on the subject of Norton Triumph Villiers—it seems that

a sectoral planning agreement was reached with NTV some years ago. It is perhaps true that the unions were not consulted sufficiently early in that process. I accept that. But the delays that have ensued have been most damaging to the future of the whole industry. I should like the Government to consider how a Planning Agreement, as applied to an NTV situation, would have improved the situation and led to a speedier conclusion.
On Planning Agreements we must surely have a commitment by all three parties involved—namely, Government, management and unions. What I find lacking in the Bill is any suggestion that there is a commitment on the part of the Government except in terms of the financial assistance available. The present system does not involve the whole gamut of policies which affect industry, and is without commitment by the unions. Unless there is some commitment, I believe that we shall make no serious progress.
Labour Members have cited British Leyland. Owing to industrial action there has been a loss of production in that concern. Indeed, if the production target had been reached it would have provided that company with sufficient funds for investment. The Prime Minister recognises that public assistance to the firm with the present level of industrial dispute is no longer acceptable.
Time is running out, and I intend to be brief. I wanted to go into the need for flexibility in Planning Agreements because in my own experience, having entered the House as a director of a textile company, I know that investment decisions have to be changed in the light of circumstances when new machinery becomes available. I believe that we shall run into great difficulty if we become too rigid in our thinking. Therefore, I hope that the Government will look again at the possibility of introducing necessary changes.
In regard to exchange of information among the three parties to such agreements, we must recognise that there are matters which require to be kept confidential, particularly those involving new developments and closures. This consideration has excited some Labour Members, who feel that information must be


widely broadcast, but it is not practicable widely to discuss possible future closures since that will only bring about a closure much more quickly than if one tries to control the situation, or even to avoid closure. In discussing complex planning strategy one must consider the various options which are open to government.
Finally, I should like to know whether Planning Agreements are to be buttressed by the use of price controls. I have attempted to put this question to the right hon. Lady the Secretary of State for Prices and Consumer Protection. I suggested to her that the only consequence of holding down the price of Ford motor cars while allowing the price of British Leyland cars to rise would be to deprive British Leyland of a market and, inevitably, to increase output at the Ford company. Perhaps the Minister, in replying to the debate will say whether the Government still intend to use their price controls in this connection.
Since I have undertaken to be brief, I shall cut short my remarks on the National Enterprise Board. I conclude by taking up the remarks of one Labour Member who said that he was not particularly clear where the ramifications of the Bill would lead. Conservative Members are afraid that the Bill will not lead to any further investment—indeed, that its provisions will suffocate investment.
On the question of industrial democracy, when we look at the present situation in the nationalised industries and the democracy that exists in those sectors we fear that it will lead to an extinction of democracy and to a system based on Eastern. European lines. For this reason, I shall be among those who will vote against the Second Reading of the Bill.

8.50 p.m.

Mr. Ted Leadbitter: In the five minutes at my disposal before I give way to the Minister I hope that I shall be able to make a few short points. The House must bear in mind one fundamental fact in regard to the problem of bringing confidence back into industry and ensuring prosperity for those who work in it. Every scheme which has been brought before the House in the past by Governments of both complexions has failed to pass the test of being successful. In other words, the

endemic problems have persisted—unemployment, regional problems and many other matters have caused a great deal of frustration. Unfortunately, they have brought about a sense of hopelessness which perhaps has not been fully reflected in this debate. If in the past we have not succeeded, and if regional policies, incentive programmes and investment programmes have not produced a dynamic industry, there must be another way. I do not suggest that this is the way. However, it is important to examine all policies.
The Secretary of State has suggested that the Government should take over direct responsibility to help industry. It is nonsense for the Opposition to suggest that that is interference, especially in view of their past record. However, I do not wish to spoil my contribution by making sharp, irrelevant party political points.
If the House is concerned with the question of confidence, many hon. Members have failed to underline that fact during the debate. The House cannot get away with the notion of spending 48 hours in a state of recrimination and of personalising the issue, when outside this building management and men are asking that Parliament shall act as a barometer, showing there is a new way and that it is worth trying. The House should bear in mind that the Bill will be put right in Committee, where it will be examined with great care. The Bill will be the responsibility of Parliament and not of the Secretary of State.
Over a quarter of a century I have had experience of high unemployment levels in my constituency. There is a steel industry which has been teetering on the brink of uncertainty for several years, with 4,000 men worried about their jobs. At present, some 2,000 in my constituency are out of work. The rate of redundancy has persisted, so that whenever attempts have been made by both Governments the gap between the introduction of the new industries and the decline of the old has persisted and often widened.
So I welcome the Bill. It will give the people in my constituency and in Scotland, Merseyside and Wales, a chance to see that the House of Commons has come to its senses. We have an opportunity to look at the Bill in a proper and objective manner, so that even though


it is not perfect they can see that it attempts to bring about a partnership between Government, management and men, to create the prosperity which we all desire.

8.54 p.m.

Mr. Nicholas Fairbairn: I am indebted to the hon. Member for Hartlepool (Mr. Leadbitter) for enabling me to contribute to the debate. I was most impressed at what he said in his conclusion. Nothing is more important than the partnership of human beings in their work and industry. But of all the idiocies which Lewis Carroll created for our amusement, none equals the Red King absurdities of this Bill by means of which the present incumbent Mad Hatter has imprisoned British industry and transferred all power not to the working men but to those who operate at the top of unions.
The Bill proceeds on two assumptions, both of which are bad. One is arrogance and the other is deceit. The first assumes that there are geniuses in this country, hitherto untapped and assumably idle, who can do what nobody in industry has done so far. The second is that the failure of British industry can be put right by the genius of the incumbent Minister.
Apparently six to 15 people are to be found in this country who evidently share the Minister's intellectual genius and are capable of putting industry right for all time. They must have his magical powers or, at any rate, his faith in his magical powers.
The method by which they will work is the same democratic method by which all Government Departments work. Is that assumed to be the preferable method?
Who are these six to 15 people who are to do so well? According to Schedule 1, if a member of the Board
has become bankrupt or made an arrangement with his creditors … the Secretary of State may declare his office as a member vacant.
These are the geniuses who are to run industry in this country. Even Plato never thought that he could find more than 12 philosopher kings.
Which of the functions will the Secretary of State serve? If the functions of the Board are, on the one hand, to promote industrial efficiency and inter-

national competitiveness and, on the other hand, to provide, maintain and safeguard employment, what happens if they conflict? Will it be ultra vires of the Board to promote anything which is not profitable? Will it be ultra vires if it promotes something which becomes less efficient or less competitive? If so, what are the penalties for so doing?
We then come to the fact that the Board is to take profitable sections of industry into public ownership. What is public ownership? It is a situation in which what is presently owned by members of the public is no longer owned by them. It is some nebulous form of legal uncertainty. It is owned by nobody at all. It is not public ownership. What does the Minister own in anything that is in so-called public ownership?
We then come to the next extraordinary situation—that we are to have industrial democracy. The House should not overlook this point. What is meant by "industrial democracy"? We are dealing with human relations. The Bill refers to the sharing of power. The intention is not to enable the ordinary working man to share power but to ensure that there is a concentration of power in the hands of a few big union dictators. Small is beautiful. The bigger the firm, the bigger the organisation, the less power the man has. The Bill will ensure that the organisation always gets bigger and the man has less power.

Mr. Douglas Crawford: Small is very beautiful.

Mr. Fairbairn: Small is indeed very beautiful.
Let us look at the organisations. Rolls-Royce, ICL (Computers), Kearney Preeter, NVT, British Leyland, Ferranti and Foden will be in the hands of about 15 people. What would hon. Gentlemen opposite say if a capitalist had power over all those companies? They would say that it was scandalous. Yet this is their definition of democracy. It is kakistocracy. I trust that the Minister knows enough Greek to appreciate that that means the rule of the worst people, not of the people.
The purpose of this Bill is to put everybody who works into the power of the union dictatorship, to give it the information and the power to enable it to manipulate the policies of any Government and


any company and the life of every citizen who works and earns his living in this country.

9.0 p.m.

Mr. John Peyton: I should like first to congratulate my hon. and learned Friend the Member for Kinross and West Perthshire (Mr. Fairbairn) and the hon. Member for Hartlepool (Mr. Leadbitter) on their remarkable self discipline. Nothing is more difficult than to make a five minutes' speech in this place at the end of a debate. Somebody once remarked that a week was a long time in politics. Anybody taking part in and sitting through a two-day debate could readily modify that statement to the effect that two days in politics can seem an age. I mean, of course, no reflection on the speeches to which we have listened.
I should like particularly to refer to the excellent speech made by my hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths) in opening the debate from this side of the House this afternoon. It was a really first-class and admirable performance, and I am sorry that he was not heard by more people. The hon. Member for Rochdale (Mr. Smith), whose presence is so easily missed in this House, delivered a much-needed powerful reinforcement to the Liberal case when he arrived today. His definition of the Bill must have caused a great deal of suffering to its admirers on the benches opposite when he condemned it as a shambles and said, in his language, that it was a rotten Bill. I do not think that any of us on the Opposition side of the House would dissent from that judgment.
The hon. Member for Preston, South (Mr. Thorne), whom I do not see in his place at the moment, produced a most impassioned plea, which stirred us all greatly, for the nationalisation of the drug industry. The thought of swallowing an aspirin manufactured under the authority of the right hon. Gentleman the Secretary of State appals me. However, the hon. Gentleman's disapproval of the Bill was the first thing that I had heard to be said in its favour.
The hon. Member for Caernarvon (Mr. Wigley), whom we also miss—I hope he will be back to hear the Minister of State, the hon. Member for Liverpool, Walton (Mr. Heffer) replying—had a lot

of questions, and if the Minister answers even a small fraction of those Nationalist questions he will do very well. He will have to make some other arrangement in order to get that lot into the Lobby with him.
The hon. Member for Gloucestershire, West (Mr. Watkinson) launched himself into one of those time-honoured hymns of hate against the City of London. I dare say the City of London will survive that, if not other aspects of the Government's activities. The hon. Member recalled the golden days of Selsdon Man. We are all very much obliged to the Labour Party, which lives on its own mythology and sometimes can spare the time of its mythologists in order to manufacture some for us. We appreciate it very much.
My right hon. Friend the Member for Renfrewshire, East (Miss Harvie Anderson) made a most trenchant examination of the various aspects of the Bill. I hope the Government will prepare themselves to give some adequate answers when the Bill is in Committee. The only gem to which I would call attention is on page 12, line 30, where the Bill says:
Two bodies corporate are in the same group for the purposes of subsection (7A) above if one is the other's holding company or both are subsidiaries of a third body corporate.
Not absolutely clear, but, nevertheless, one of the nicer bits of the Bill.
The hon. Member for Rossendale (Mr. Noble) supported the Bill with some enthusiasm. He should talk to his right hon. Friend the Paymaster-General, who treated the Bill with much greater respect—in fact, he hardly liked to touch the nasty thing at all. He and his right hon. Friend ought to have a little talk to see whether they are discussing the same measure. My hon. Friend the Member for Bromsgrove and Redditch (Mr. Miller) gave us a timely reminder that we do not live in a capsule and would do well to try to earn the confidence of the outside world—something we lack at the moment.
It seems that we are all investors now—just for today. Normally, we are on the side of consumption and we do not bother about investment or providing for the future. It made a nice change that, for at least two days, even the Labour Party


could bring itself painfully to concentrate upon investment.
In moving the Second Reading the Secretary of State prompted more questions than he answered. It is only fair to say that the Paymaster-General was a great deal more respectable today. Early in his speech the Secretary of State said—
we intend … winning active support for these policies."—[Official Report, 17 February 1975; Vol. 886, c. 935.]
We waited to hear how he intended to win support. He did not say. The right hon. Gentleman seemed unaware of the opinion held of him by British industry, of which he was reminded by my right hon. Friend the Member for Knutsford (Mr. Davies).
Perhaps I could break off at this point and say how delighted I am to see the Patronage Secretary returning to his customary place on the Government Front Bench.
My right hon. Friend the Member for Knutsford was speaking for others besides himself when he described the Secretary of State as a danger and a menace to industry. That is a widely-held opinion. If it were not for the arrogance of the right hon. Gentleman he might take it seriously enough to want to make some kind of conscientious effort, at some time, to dislodge it and convince the broad mass of industry that it is wrong and that he has been misjudged.
The right hon. Gentleman went on to invite the House to examine the magnitude of the problem now facing us. He prompted the question whether he has done that, or has just rushed in with some cherished nostrum of his own which he desperately hopes will fit what is admittedly a desperate situation. He did not explain how his Bill will work, and I do not suppose for a moment that anything he said will satisfy his hon. Friend the Member for Basildon (Mr. Moonman) who yesterday said that
there should be some reference to the fact that there is clearly a connection, which has not been specified so far, between the Bill's purpose of intervening in industry and its proclaimed aim of efficiency.
In the next column he said:
Obviously this is not the time or place to spell out such choices, but it is a sorry comment on British economic practice that the

public and those who run industry can legitimately ask, even with last summer's famous White Paper at hand, whether the choices have been seriously thought about and whether the infrastructure necessary for making them is being prepared."—[Official Report, 17th February 1975; Vol. 886, c. 1035–6.]
I hope that the right hon. Gentleman will give some thought to this because, even though he does not like listening to the case that is made against him, there are many people who hope that he will pay attention and convince them that he is conscious of their anxiety, and will not spend his time talking to his neighbour on the Front Bench and not listening to the case that is made against him.
I come to the question of Planning Agreements. The right hon. Gentleman described the system as being voluntary, but that surely is stretching language a bit. A man to whom a lifebelt is thrown can hardly be said to take that lifebelt voluntarily if he has no other choice, and it may be that in the context of modern industry there will be no choice for many people but to accept this somewhat poisoned chalice.
The right hon. Gentleman said yesterday that investment on the scale we needed never took place. He never sought for a moment to inquire why that investment had never taken place. He never referred to the question of confidence which, of course, is at the root of all troubles. It is one of the most delicate plants and can easily be destroyed under any Government, but the right hon. Gentleman seems to be utterly careless about it.
The Secretary of State did not refer to the possibility that we may have been making the almost fatal mistake of living beyond our means for far too long and attempting dishonestly to conceal it from ourselves.
I should like to go on to that strange creature, the National Enterprise Board. The Paymaster-General was not always so keen about this. In June 1973 he wrote that the National Enterprise Board
will be the most powerful body in the country, more powerful within its field of activity even than the elected Government.
A few days later in the Observer he said:
It is a bad idea. It derives from a vision of a monopolistic society ruled by technocrats.
Those are his words, and they are an eloquent condemnation of this creature.
Today, the Paymaster-General said that there will always be a danger that the aid will go to the weakest companies. I endorse that anxiety absolutely. I feel that the assistance now being generated by the Government will almost always go to the baby that cries the loudest and to the victim that can call to his support the maximum of political pressure. Indeed, it was my hon. Friend the Member for Arundel (Mr. Marshall) who, in an eloquent speech yesterday, said that industrial issues would become overlaid with politics. I agree with that verdict absolutely, and I feel that as time goes on, and as we experience the working of this measure, right hon. Gentlemen opposite will come bitterly to learn the same thing.
Mention has been made of the IRC. I should not wish to go into that at great length save to say that the IRC had its unpleasant side, and I do not believe it at all unlikely that the NEB could itself breed some fairly unpleasant aspects before long in its career.
The right hon. Gentleman touched very briefly on the question of information. This, as he ought to know, is a matter of great concern to many people, not because of some love of secrecy, or to keep things from their employees, or anything like that, but because there is knowledge of a commercial kind which is of enormous value to companies. In his speech yesterday the right hon. Gentleman dealt with this in less than half a column and in a way which indicated that he was barely thinking about it at all, though he said he would later be talking to the TUC and the CBI.
These measures are not necessarily sufficient to allay the anxieties of industry on this important subject. The Minister said nothing about the way in which the Government were to equip—[Interruption.] I wonder whether I might have the attention of the Minister of State after he has finished speaking to one of his hon. Friends. I suggest to my right hon. and hon. Friends that when the Minister of State replies he should be listened to in silence and with courtesy, even though that is something he is quite unable to extend to others.
The Secretary of State yesterday said nothing about the way in which the Government were to equip themselves to

take on these further functions. I believe that Governments in this country would be well advised to do a good deal less until they can do the essentials much better than at present. One of the more deplorable features of our arrangements is how little time any of us ever manages to give to the framework and organisation of government which still remains, in essence, Victorian, with a terrible overgrowth of more modern times.
This has been a depressing and dismal debate. The Paymaster-General made clear that Britain had not had a magnificent economic record since the war. I wonder whether the Bill is not attempting to deal with a whole collection of deep-seated problems in a superficial and optimistic fashion. Is it possible, for instance, that we have been living so much beyond our means that we have had insufficient resources available for investment? What part in our disappointing industrial performance has been played by the background of the slums and debris of the last century?
The hon. Member for Rossendale referred to the degeneration of his constituency. The problem is not restricted to the hon. Member's part of the world. What have we done about that? Totally inadequate measures have been taken to cure this lasting sore, but anyone who is curious enough to find out what is wrong with this country could do worse than pay a visit to some of our major ports—places where the prosperity of the last century was located but where today there is an atmosphere of grim dereliction, sourness and stubborn, primitive attitudes against a background of dirty, scruffy buildings which can inspire no one.
I am sure that my right hon. Friend the Leader of the Opposition will forgive me for referring to the education system. [Interruption.] It is all very well for Labour Members to mock. They so often take refuge in that fashion. Do we ask ourselves often enough whether the education system is adequately geared to take account of industry and its needs and aims? What of the burden of tax upon industry? We hear various figures, but the best figure I have been able to find was given by Professor Lawson, of the Manchester Business School, and it is that the effective rate of tax upon industry's profits over the 6½ years to October


1974 was 63 per cent. That slightly conflicts with the facile judgments made by the Secretary of State.
Then there is the complexity of our tax system, in which we seem almost to take pride, and above all the frequency with which we change it. An enormous amount of effort, time and skill is diverted into purely accountancy functions to get used to some new antic or requirement imposed upon industry by the Government, with no thought of the consequences of their actions. There is the question of the time requirement imposed upon industry to satisfy the demands of Government. I understand that one nationally-known firm is paying a salary bill of £250,000 a year to people whose job it is simply to frame applications to the Price Commission for increases.
I come to another point which seems to me to be a great weakness in our economy—the nationalised industries so dear to the hearts of Labour Members. They are harassed, not controlled, by Government. What depresses me about the prospect for those firms which come within the yoke of the National Enterprise Board is the treatment already meted out to the Government's own pets, the nationalised industries.
The capital investment programme of nationalised industries is usually approved in the year preceding that in which it is to take effect. I do not believe that the Treasury has the remotest understanding of the requirements of industry. I sometimes think that in Treasury language a long lead is something on the end of which one takes a small dog for a walk.
The lack of power of trade union leaders to control their wild men is another source of unease and difficulty in our industrial situation. Unfortunately, a substantial part of management feels that there is no need to explain to its employees the situation of either the country generally or the concern in which they work. One of the more unfortunate habits of the House has become its keenness to lambast management on every possible occasion. It is a favourite theme of anyone who makes a speech to point out the inadequacy and ineptitude of British management. But I do not believe that any other industrial manage-

mentin the world has to face from its own politicians a misfortune similar to that with which we habitually face ours.
There is a kind of lingering stuffiness in the whole climate of our affairs which comes from the needs of a class system generated by a system of land tenure which prevailed in the Middle Ages. It hardly seems realistic that it should have survived, yet no one is keener or more enthusiastic to preserve it and make capital out of it than the Labour Party.
There is also the regular insistence by the media, particularly television, on treating industrial problems, and especially industrial disputes, as though they were football matches, with the media as the referees. I know no practice that does more harm.
I believe that the specific which is now launched before Parliament by the Government for the curing of our industrial ills will do nothing to help. I believe that the complete unwillingness of the Labour Party to advert to and concentrate upon some of the evils, shortcomings and deficiencies in our society is really at the root of our trouble, and, in particular, the facile ease with which they have urged this country to live substantially beyond its means and even sought to teach it that effort and enterprise have nothing to do with a high standard of life.
It is a modern practice to fan discontent throughout the nation and not to promote unity. Hon. Gentlemen can scoff as they wish, but I do not believe that there is any other country in the world so perilously unaware as we in this country are of our present plight. Nor have the Government done anything to warn this country of the consequences of hazarding a system the blemishes of which it may be fun to point out but which nevertheless is still a system which has afforded to more people than ever before in human history the chance to enjoy more, in conditions of less constraint.
I believe that the present Government of this country, fortified by less than 40 per cent. of the votes, is launching Left-wing policies upon the country, are not only risking dividing the country but are embarking upon policies which will divide this country, and not unite it—policies which will have the effect of diverting this


nation from the real perils. I am afraid that when we discuss an important Bill such as that which we are discussing tonight—a Bill which carries with it a real threat to the industry by which we live—the attitude of right hon. and hon. Gentlemen on the Government side is trivial and petty and will be seen in the short run to be far short of what this country requires.

9.28 p.m.

The Minister of State, Department of Industry (Mr. Eric S. Heffer): Before I reply to the points that have been raised, may I say to the right hon. Member for Yeovil (Mr. Peyton) that I was not being discourteous. I had a question put to me by a colleague behind me. I apologise if he thought that I was being discourteous to him.
Despite some fanciful and typically immoderate statements by some Opposition Members, this long debate has been a very serious debate. I think that is right because for the last two days we have been discussing nothing less than the future of British industry at a time of looming international crisis. I agree with those hon. Members on both sides of the House who said that we should not expect too much from this Bill in the sense that it will not solve our problems overnight.
However, it is a tremendous step forward. It gets to the root of our problems. It creates new and essential investment. But it will not, as some Opposition Members suggest, of itself lead to the creation of the Socialist millenium. Nor will it, as some Left-wing critics outside this House suggest, prop up and bolster a decayed system which has outlived itself. Nor is it the development of Government instruments towards the corporate State. If that were so, the work people would be expected to be passive sightseers rather than being involved in the decision making proposed in the Bill.
My approach to the Bill and to this debate is one of total commitment to the wellbeing of those who work in British industry at all levels. I say that because the well being of all our constituents depends upon British industry being healthy. We must not fail the people, especially those who live in constituencies such as that which I represent and who have known of the burden of unemployment for so many years.
I hope that the House will agree with me when I say that we all want to see more investment in British industry. We cannot accept a situation in which workers in the United States, in France and in Japan are backed up by twice as much investment a year as are British workers. We cannot accept a situation in which we seem incapable of getting anything like the increased output for each pound spent on investment as do competitor firms in these other countries. We as a nation must not accept a continuing relative decline in our country's industrial standing. I am sure that every right hon. and hon. Member shares my feeling in this regard.
I make one comment in passing, however. The hon. Member for Bury St. Edmunds (Mr. Griffiths) tried to pretend that the increase in bankruptcies in this country between 1973 and 1974 had something to do with the change of government. We have heard the same suggested by Opposition Members many times during the debate. But do they not know that something is happening in the world in relation to the international crisis? Do they not know that unemployment in Germany is now three times as high as it was in 1973? Do they not know that unemployment in the United States is now running at 8·2 per cent.—the highest level since 1941?
This Labour Government control neither Germany nor the United States—[HON. MEMBERS: "That is why they are doing well."]—With an unemployment rate of 8·2 per cent.? The Opposition know that it is a false argument to suggest that the lack of investment has occurred because we have had a Labour Government since February of this year.
I am sure that the House is united in its condemnation of the waste of human resources which has resulted from our inability to lift the burden of unemployment from the development areas, which itself arises directly from our collective failure to achieve an acceptable national rate of economic growth by harnessing the creative energies of the British people.
As I am a Minister with special responsibilities for regional industrial matters, perhaps the House will allow me to begin my response to the points made in the debate by dealing with the regional aspects of the Bill. The Bill contains


two major proposals of concern to the regions. First, through Planning Agreements we shall seek to encourage companies to seize the opportunities open to them in Northern Ireland, Scotland, Wales and the English regions. Everyone will agree that much good work is already being done to this end by my Department and the other Departments concerned. But the Planning Agreement arrangements will provide a unique opportunity to go into the location of investment projects at a formative stage in the company's planning process. We shall use the powers of selective assistance in the 1972 Act to the full, during our discussions on an agreement, to assist the regions.
Second, through the National Enterprise Board we shall be creating for the first time a public corporation in manufacturing industry with special responsibility in the regions. I think that the whole House must agree that the experience of the last 25 years shows that while financial incentives are valuable, they are, by themselves, inadequate to achieve our purposes. In fact—it has been again stated in the House by hon. Members from both sides—we have actually been running fast to stand more or less in the same place. In spite of the fact that we have created 300,000 jobs as a result of regional policies between 1960 and 1971 and of the substantial efforts before and since then, the fact remains that the areas worst hit by the depression of the 1930s—this matter was referred to by the right hon. Member for Yeovil—are still the worst areas. They are the development areas and special development areas of today.
If we are to solve the regional problem, the powers provided by the Industry Act 1972 need to be backed by a power of direct action. This is to be provided through the National Enterprise Board, which will operate directly to create jobs in areas of high unemployment. It will do this, first, through direct investment in firms in the regions; second, by entering into joint venture with other firms in these areas; third, by giving special emphasis in the firms which it owns to expansion in the regions; and fourth, by starting new companies of its own in areas in which the need for the new jobs is urgent. I regard this particular point as

one of the most important aspects of the Board's operations. This is what I mean when I talk about the power of direct action.
The question of the location of the headquarters of the NEB was raised by one of my right hon. Friends. I want to make it clear that I consider that, in discharging its responsibilities to the regions, it is essential that the Board should have powerful representation through offices in the North-East and the North-West of England. In Scotland and Wales, of course, parallel responsibilities will be discharged by the Scottish and Welsh Development Agencies, which I am confident will make a major contribution in their countries.

Mr. Wigley: Will the Minister clarify the point raised by parallel responsibilities? Will the Welsh Development Agency have the right to make Planning Agreements and will it have any rights to intervene in subsidiary and branch factories in Wales?

Mr. Heffer: The National Enterprise Board will not make Planning Agreements. Planning Agreements will be made between a company, the Government and the trade unions involved. The headquarters of a company could be anywhere. Therefore, the Planning Agreement will be made with the parent company or even with the subsidiary of such a company. The hon. Gentleman will need to wait a few moments until I turn to the relationship between the Scottish and Welsh Development Agencies and the whole question of the National Enterprise Board.

Mr. Eldon Griffiths: Before the hon. Gentleman becomes involved in whether he will obtain the votes of the national parties, will he deal with a specific point? He has spoken of direct action in the regions by the NEB. He has talked of dealing with unemployment and many like advantages. Will the firms in the regions in which the NEB invests be expected to make a profit?

Mr. Heffer: The hon. Gentleman knows that on total returns there must be an adequate return on the NEB's activities. At a given moment it is obvious that financial decisions or directives will be made on the activities of the Board. The


hon. Gentleman must understand that on occasions we may require for social reasons to assist—[Interruption.] Is not that what the whole of the regional policy is about? If Conservative Members are now deciding to abandon regional policy, to abandon every company that gets into difficulties, especially in areas of high unemployment, and to abandon the workers to unemployment, they had better tell us. They had better let the country know the precise terms of their policy. If the hon. Gentleman does not mind I shall continue with my speech.

Mr. Crawford: When the Minister says that the Scottish Development Agency and the Welsh Development Agency shall have powers of responsibility for the NEB, does that mean that the writ of the NEB will not run in Scotland, or is he going back on what the Under-Secretary of State said last night—namely:
The NEB will not exercise its function in Scotland in relation to companies which span the border.

Mr. Heffer: Of course the NEB will run in Scotland. I put this to the hon. Gentleman and to all other hon. Members from the various regions of Great Britain—

Mr. Crawford: We are not a region.

Mrs. Winifred Ewing: On a point of order, Mr. Speaker. As has been already conceded over and over again by Ministers and Shadow Ministers, Scotland is a nation and not a region. Why are we having these problems of terminology?

Mr. Speaker: I do my best. Fortunately I do not have to decide this particular problem.

Mr. Heffer: Nobody is arguing that the Scottish people have not their own national characteristics and consider themselves possibly as a nation.

Mrs. Winifred Ewing: Not "possibly" but as a fact.

Mr. Heffer: Nobody is arguing about that. What I am trying to say to the hon. Member for Moray and Nairn (Mrs. Ewing) and to her hon. Friends in the SNP—[Interruption.] If they will listen for a moment, they may hear something to their advantage. What I was about

to say was that they can benefit from the activities of the NEB, if the Board is given a directive by my right hon. Friend after the fullest discussion with the whole Government. I make that point because this Bill is the responsibility of the whole Government and not merely of my right hon. Friend the Secretary of State for Industry. If we make a directive to put in factories to create employment in Scotland, in Wales, or in any of the English regions, will anybody on the Opposition benches object? That is what the activities of the NEB will bring about, and I regard it as a matter of great importance.
With its headquarters in London the Board will be enabled to contact, at top level, companies which have their headquarters in the South-East; and with offices in the North-East and North-West, enabling it to build up links with local firms, the NEB will be strategically located to discharge its responsibilities to the nation and the regions most effectively.
We have been asked during the debate about the relationship between the NEB and the Scottish and Welsh Development Agencies. Those two agencies will be quite distinct from the NEB. They will be set up as fully independent bodies under their own statutes. These agencies are to have an important rôle in support of Government in securing greater industrial development in Scotland and Wales. In England the NEB will have a parallel function and certain wider functions which can be discharged only on a United Kingdom basis—for example, in industrial reorganisation, or as a source of investment capital to companies operating on a national basis and also, on occasions, as an agent of Government for channelling assistance to companies in England or companies operating on a national basis.
It will be through the NEB that the Government will pursue their policy of extending public ownership into profitable manufacturing industry. There will need to be arrangements for close consultation between the Board, the two agencies and the Northern Ireland Finance Corporation. We shall discuss this matter with the Secretaries of State concerned.
Therefore, through Planning Agreements, the NEB, the Scottish and Welsh


Development Agencies, and the Northern Ireland Finance Corporation, we shall have a powerful armoury to help forward our work of solving the intractable problems of unemployment in the old industrial areas which have remained almost unchanged since the 1930s.

Mr. Tom King: The Minister has spelt out an impressive range of functions for the NEB. Since there is no mention of the matter in the Bill, will he say how many staff will be needed for the NEB to staff its head office or its regional offices?

Mr. Heffer: The hon. Gentleman knows that it is not possible for anybody to give the exact figure of the staff involved. That will depend on the extension and growth of activities of the National Enterprise Board.

Mr. Heseltine: rose—

Mr. Heffer: I have already given way several times. I have an important speech to make and I intend to finish it in ten minutes.
Dealing with information, while many Members on both sides of the House will find little difficulty in agreeing on the need for new measures in the regions, it is clear that we are deeply divided on the proposals for providing information to workers through their trade unions.
The provisions on information in this Bill represent the Government's deeply-held conviction that the regeneration of British industry depends not only on investment, on schemes of reorganisation and reconstruction, and so on, but also on increasing the effectiveness of our major companies by enabling workers to take a creative part in the conduct of industry.
The time is past when workers were content solely with being employed. Nor should the nation be satisfied with a situation in which all too often the only effective means of expression available to workers is their right of veto through industrial action.
If we as a nation are to solve our economic problems, I am convinced that workers must have an opportunity to be involved creatively in the decisions that govern the future of the enterprises in which they work.

Mrs. Winifred Ewing: What has the Shadow Secretary of State for Scotland to say?

Mr. Heffer: We have been told—

Mrs. Winifred Ewing: Ask the Shadow Secretary of State.

Mr. Speaker: Is the hon. Lady well?

Mrs. Winifred Ewing: On a point of order, Mr. Speaker. The hon. Lady is very well. However, the Shadow Secretary of State is not well. He has not risen to his feet.

Mr. Speaker: Fortunately, neither are matters for me.

Mr. Heffer: We have been told that it is the conviction of all hon. Members that there must be greater industrial democracy. However, greater industrial democracy can be achieved only if workers are provided with basic information about company plans, against which the Opposition are now arguing. A great deal of confusion has been expressed by the Opposition. The Conservative Members of Parliament have said repeatedly that the information will be given only to trade union officials. I want to make it clear that that is not the position. The information will be available to trade union officials and to shop floor representatives who, on the basis of British shop floor experience, will call meetings and pass on their information where necessary and discuss it with workers on the shop floor. That is what the question of information is about.
It is obvious that I shall not be able to say one third of what I had intended to say in the debate. I emphasise that it is not the Government's wish to base relationships between workers and management in industry upon the use of compulsory information powers. Where a company has good arrangements for informing and consulting its workers through their trade unions on the formation of its plans, the use of compulsory powers would be irrelevant. Arrangements entered into on a voluntary basis are much more satisfactory than the use of a statute.
We are therefore retaining the important concept set out in our White Paper that the information powers should be reserve powers. We shall have detailed consultations with representatives of industry and


the trade union movement on the way in which these powers should be used and the way in which the various safeguarding provisions should be interpreted. I want to make it absolutely clear that we shall certainly wish to advise the House on the outcome of these consultations when the relevant parts of the Bill come into Committee.

Mr. Heseltine: Will the hon. Gentleman give way?

Mr. Heffer: I will now, yes.

Mr. Heseltine: Is the hon. Gentleman seriously saying that he has not had consultations with the TUC and the CBI on these powers before putting them to the House in draft form? Why has he not consulted industry before putting them to us in the Bill?

Mr. Heffer: The hon. Gentleman is surely aware that the White Paper has been discussed at Neddy. Consultations have taken place with the TUC and the CBI. The hon. Gentleman is fully aware of that. I was making it clear that this Government, even in the course of a Committee stage, are prepared to discuss the matter with interested bodies. That does not mean that we shall give way on the matter. It means that we are prepared to discuss it.
In conclusion, I want to deal directly with some of the wholly mistaken comments that have been made on the Bill—as mistaken, if I may say so, as the

apparent assumption by some hon. Gentlemen opposite that we can solve our economic problems by the remedies that have failed us for at least 20 years. That is a view that we on the Government side of the House totally reject.

I also want to nail the mistaken view that this is the policy of one Secretary of State who has been deliberately built up as the favourite bogyman of the age. As I said earlier, the truth is that it represents the policy of the whole Government. It has been set out in publication after publication of the Labour Party. It was clearly explained in the White Paper. It has been further explained at length by the Prime Minister in speeches to the Labour Party Conference and in the country.

I repudiate entirely the allegation that in the National Enterprise Board we have created an instrument of intervention outside the bounds of Government and parliamentary control. All significant acquisitions of companies by the NEB will be subject to the approval of the Government.

Hon. Gentlemen opposite have suggested that we are out to build a Soviet-style society. That is nonsense, and they know it. We intend to advance the interests of the British working people by creating an industry acceptable to the whole country.

Question put, That the Bill be now read a Second time:—

The House divided: Ayes 313, Noes 299.

Division No. 94.]
AYES
[10.0 p.m.


Abse, Leo
Broughton, Sir Alfred
Craigen, J. M. (Maryhill)


Allaun, Frank
Brown, Hugh D. (Provan)
Crawshaw, Richard


Anderson, Donald
Brown, Ronald (Hackney S)
Cronin, John


Archer, Peter
Buchan, Norman
Crosland, Rt Hon Anthony


Armstrong, Ernest
Buchanan, Richard
Cryer, Bob


Ashley, Jack
Butler, Mrs Joyce (Wood Green)
Cunningham, G. (Islington S)


Ashton, Joe
Callaghan, Rt Hon J. (Cardiff SE)
Cunningham, Dr J. (Whiteh)


Atkins, Ronald (Preston N)
Callaghan, Jim (Middleton &amp; P)
Dalyell, Tam


Atkinson, Norman
Campbell, Ian
Davidson, Arthur


Bagier, Gordon A. T.
Canavan, Dennis
Davies, Bryan (Enfield N)


Barnett, Guy (Greenwich)
Cant, R. B.
Davies, Denzil (Llanelli)


Barnett, Rt Hon Joel
Carmichael, Neil
Davies, Ifor (Gower)


Bates, Alf
Carter, Ray
Davis, Clinton (Hackney C)


Bean, R. E.
Carter-Jones, Lewis
Deakins, Eric


Benn, Rt Hon Anthony Wedgwood
Cartwright, John
Dean, Joseph (Leeds West)


Bennett, Andrew (Stockport N)
Castle, Rt Hon Barbara
de Freitas, Rt Hon Sir Geoffrey


Bidwell, Sydney
Clemitson, Ivor
Delargy, Hugh


Bishop, E. S.
Cocks, Michael (Bristol S)
Dell, Rt Hon Edmund


Blenkinsop, Arthur
Cohen, Stanley
Dempsey, James


Boardman, H.
Coleman, Donald
Doig, Peter


Booth, Albert
Colquhoun, Mrs Maureen
Dormand, J. D.


Boothroyd, Miss Betty
Concannon, J. D.
Douglas-Mann, Bruce


Bottomley, Rt Hon Arthur
Conlan, Bernard
Duffy, A. E. P.


Boyden, James (Bish Auck)
Cook, Robin F. (Edin C)
Dunn, James A.


Bradley, Tom
Corbett, Robin
Dunnett, Jack


Bray, Dr Jeremy
Cox, Thomas (Tooting)
Dunwoody, Mrs Gwyneth




Eadie, Alex
Lamborn, Harry
Roderick, Caerwyn


Edeiman, Maurice
Lamond, James
Rodgers, George (Chorley)


Edge, Geoff
Latham, Arthur (Paddington)
Rodgers, William (Stockton)


Edwards, Robert (Wolv SE)
Leadbitter, Ted
Rooker, J. W.


Ellis, Tom (Wrexham)
Lee, John
Roper, John


English, Michael
Lestor, Miss Joan (Eton &amp; Slough)
Rose, Paul B.


Ennals, David
Lever, Rt Hon Harold
Ross, Rt Hon W. (Kilm'nock)


Evans, Gwynfor (Carmarthen)
Lewis, Arthur (Newham N)
Rowlands, Ted


Evans, Ioan (Aberdare)
Lewis, Ron (Carlisle)
Ryman, John


Evans John (Newton)
Lipton, Marcus
Sandelson, Neville


Ewing, Harry (Stirling)
Litterick, Tom
Sedgemore, Brian


Faulds, Andrew
Lomas, Kenneth
Selby, Harry


Fernyhough, Rt Hon E.
Loyden, Eddie
Shaw, Arnold (Ilford South)


Fitch, Alan (Wigan)
Luard, Evan
Sheldon, Robert (Ashton-u-Lyne)


Fitt, Gerard (Belfast W)
Lyon, Alexander (York)
Shore, Rt Hon Peter


Flannery, Martin
Lyons, Edward (Bradford W)
Short, Rt Hon E. (Newcastle C)


Fletcher, Raymond (Ilkeston)
Mabon, Dr J. Dickson
Short, Mrs Renée (Wolv NE)


Fletcher, Ted (Darlington)
McCartney, Hugh
Silkin, Rt Hon John (Deptford)


Foot, Rt Hon Michael
McElhone, Frank
Silkin, Rt Hon S. C. (Dulwich)


Ford, Ben
MacFarquhar, Roderick
Sillars, James


Forrester, John
McGuire, Michael (Ince)
Silverman, Julius


Fowler, Gerald (The Wrekin)
Mackenzie, Gregor
Skinner, Dennis


Fraser, John (Lambeth, N'w'd)
Mackintosh, John P.
Small, William


Freeson, Reginald
Maclennan, Robert
Smith, John (N Lanarkshire)


Garrett, John (Norwich S)
McMillan, Tom (Glasgow C)
Snape, Peter


Garrett, W. E. (Wallsend)
McNamara, Kevin
Spearing, Nigel


George, Bruce
Madden, Max
Spriggs, Leslie


Gilbert, Dr John
Magee, Bryan
Stallard, A. W.


Ginsburg, David
Mahon, Simon
Stewart, Rt Hon M. (Fulham)


Golding, John
Marks, Kenneth
Stoddart, David


Gould, Bryan
Marquand, David
Stott, Roger


Gourlay, Harry
Marshall, Dr Edmund (Goole)
Strang, Gavin


Graham, Ted
Marshall, Jim (Leicester S)
Strauss, Rt Hon G. R.


Grant John (Islington C)
Mason, Rt Hon Roy
Summerskill, Hon Dr Shirley


Grocott, Bruce
Maynard, Miss Joan
Swain, Thomas


Hamilton, James (Bothwell)
Meacher, Michael
Taylor, Mrs Ann (Bolton W)


Hamilton, W. W. (Central Fife)
Mellish, Rt Hon Robert
Thomas, Dafydd (Merioneth)


Hamling, William
Mendelson, John
Thomas, Jeffrey (Abertillery)


Hardy, Peter
Mikardo, Ian
Thomas, Mike (Newcastle E)


Harper, Joseph
Millan, Bruce
Thomas, Ron (Bristol NW)


Harrison, Walter (Wakefield)
Miller, Dr M. S. (E Kilbride)
Thorne, Stan (Preston South)


Hart, Rt Hon Judith
Miller, Mrs Millie (Ilford N)
Tierney, Sydney


Hattersley, Rt Hon Roy
Mitchell, R. C. (Soton, Itchen)
Tinn, James


Hatton, Frank
Molloy, William
Tomlinson, John


Hayman Mrs Helene
Moonman, Eric
Tomney, Frank


Healey, Rt Hon Denis
Morris, Alfred (Wythenshawe)
Torney, Tom


Heffer, Eric S.
Morris, Charles R. (Openshaw)
Urwin, T. W.


Hooley, Frank
Morris, Rt Hon J. (Aberavon)
Varley, Rt Hon Eric G.


Horam, John
Moyle, Roland
Wainwright, Edwin (Dearne V)


Howell, Denis (B'ham, Sm H)
Mulley, Rt Hon Frederick
Walden, Brian (B'ham, L'dyw'd)


Hoyle, Doug (Nelson)
Murray, Rt Hon Ronald King
Walker, Harold (Doncaster)


Huckfield, Les
Newens, Stanley
Walker, Terry (Kingswood)


Hughes, Rt Hon C. (Anglesey)
Noble, Mike
Ward, Michael


Hughes, Mark (Durham)
Oakes, Gordon
Watkins, David


Hughes, Robert (Aberdeen, N)
Ogden, Eric
Watkinson, John


Hughes, Roy (Newport)
O'Halloran, Michael
Weetch, Ken


Hunter, Adam
O'Malley, Rt Hon Brian
Weitzman, David


Irvine, Rt Hon Sir A. (Edge Hill)
Orbach, Maurice
Wellbeloved, James


Irving, Rt Hon S. (Dartford)
Orme, Rt Hon Stanley
White, Frank R. (Bury)


Jackson, Colin (Brighouse)
Ovenden, John
White, James (Pollok)


Jackson, Miss Margaret (Lincoln)
Owen, Dr David
Whitehead, Phillip


Janner, Greville
Padley, Walter
Whitlock, William


Jay, Rt Hon Douglas
Palmer, Arthur
Wigley, Dafydd


Jeger, Mrs Lena
Park, George
Willey, Rt Hon Frederick


Jenkins, Hugh (Putney)
Parker, John
Williams, Alan (Swansea W)


Jenkins, Rt Hon Roy (Stechford)
Parry, Robert
Williams, Alan Lee (Hornch'ch)


John, Brynmor
Peart, Rt Hon Fred
Williams, Rt Hon Shirley (Hertford)


Johnson, James (Hull West)
Pendry, Tom
Williams, W. T. (Warrington)


Johnson, Walter (Derby S)
Perry, Ernest
Wilson, Alexander (Hamilton)


Jones, Alec (Rhondda)
Phipps, Dr Colin
Wilson, Rt Hon H. (Huyton)


Jones, Barry (East Flint)
Prentice, Rt Hon Reg
Wilson, William (Coventry SE)


Jones, Dan (Burnley)
Prescott, John
Wise, Mrs Audrey


Judd, Frank
Price C. (Lewisham W)
Woodall, Alec


Kaufman, Gerald
Price, William (Rugby)
Woof, Robert


Kelley, Richard
Radice, Giles
Wrigglesworth, Ian


Kerr, Russell
Rees, Rt Hon Merlyn (Leeds S)
Young, David (Bolton E)


Kilroy-Silk, Robert
Richardson, Miss Jo



Kinnock, Neil
Roberts, Albert (Normanton)
TELLERS FOR THE AYES:


Lambie, David
Roberts, Gwilym (Cannock)
Mr. John Ellis and



Robertson, John (Paisley)
Mr. Laurie Pavitt.







NOES


Adley, Robert
Fowler, Norman (Sutton C'f'd)
Macfarlane, Neil


Aitken, Jonathan
Fox, Marcus
MacGregor, John


Alison, Michael
Fraser, Rt Hon H. (Stafford &amp; St)
Macmillan, Rt Hon M. (Farnham)


Amery, Rt Hon Julian
Freud Clement
McNair-Wilson, M. (Newbury)


Arnold, Tom
Fry, Peter
McNair-Wilson, P. (New Forest)


Atkins, Rt Hon H. (Spelthorne)
Galbraith, Hon. T. G. D.
Marshall, Michael (Arundel)


Awdry, Daniel
Gardiner, George (Reigate)
Marten, Neil


Bain, Mrs Margaret
Gardner, Edward (S Fylde)
Mates, Michael


Baker, Kenneth
Gilmour, Rt Hon Ian (Chesham)
Mather, Carol


Banks, Robert
Gilmour, Sir John (East Fife)
Maude, Angus


Beith, A. J.
Glyn Dr Alan
Maudling, Rt Hon Reginald


Bell, Ronald
Goodhart, Philip
Mawby, Ray


Bennett, Sir Frederic (Torbay)
Goodhew, Victor
Maxwell-Hyslop, Robin


Bennett, Dr Reginald (Fareham)
Goodlad, Alastair
Mayhew, Patrick


Benyon, W.
Gorst, John
Meyer, Sir Anthony


Berry, Hon Anthony
Gow, Ian (Eastbourne)
Miller, Hal (Bromsgrove)


Biffen, John
Gower, Sir Raymond (Barry)
Mills, Peter


Biggs-Davison, John
Grant, Anthony (Harrow C)
Miscampbell, Norman


Blaker, Peter
Gray, Hamish
Mitchell, David (Basingstoke)


Body, Richard
Grieve, Percy
Moate, Roger


Boscawen, Hon Robert
Griffiths, Eldon
Molyneaux, James


Bowden, A. (Brighton, Kemptown)
Grimond, Rt Hon J.
Monro, Hector


Boyson, Dr Rhodes (Brent)
Grist, Ian
Montgomery, Fergus


Bradford, Rev Robert
Grylls, Michael
Moore, John (Croydon C)


Braine, Sir Bernard
Hall, Sir John
More, Jasper (Ludlow)


Brittan, Leon
Hall-Davis, A. G. F
Morgan, Geraint


Brocklebank-Fowler, C.
Hamilton, Michael (Salisbury)
Morgan-Giles, Rear-Admiral


Brotherton, Michael
Hampson Dr Keith
Morris, Michael (Northampton S)


Brown, Sir Edward (Bath)
Hannam, John
Morrison, Charles (Devizes)


Brown, Robert C. (Newcastle W)
Harrison, Col Sir Harwood (Eye)
Morrison, Hon Peter (Chester)


Bryan, Sir Paul
Harvie Anderson, Rt Hon Miss
Mudd, David


Buchanan-Smith, Alick
Hastings, Stephen
Neave, Airey


Buck, Antony
Havers, Sir Michael
Nelson, Anthony


Budgen, Nick
Hawkins, Paul
Neubert, Michael


Bulmer, Esmond
Hayhoe, Barney
Newton, Tony


Burden, F. A.
Henderson, Douglas
Normanton, Tom


Carlisle, Mark
Heseltine, Michael
Nott, John


Carr, Rt Hon Robert
Hicks, Robert
Onslow, Cranley


Carson, John
Higgins, Terence L.
Oppenheim, Mrs Sally


Chalker, Mrs Lynda
Holland, Philip
Osborn, John


Channon, Paul
Hooson, Emlyn
Page, John (Harrow West)


Churchill, W. S.
Hordern, Peter
Page, Rt Hon R. Graham (Crosby)


Clark, Alan (Plymouth, Sutton)
Howe, Rt Hon Sir Geoffrey
Paisley, Rev Ian


Clark, William (Croydon S)
Howell David (Guildford)
Pardoe, John


Clarke, Kenneth (Rushcliffe)
Howell, Ralph (North Norfolk)
Parkinson, Cecil


Clegg, Walter
Howells, Geraint (Cardigan)
Pattie, Geoffrey


Cockcroft, John
Hunt, John
Penhaligon, David


Cooke, Robert (Bristol W)
Hurd Douglas
Percival, Ian


Cope, John
Hutchison, Michael Clark
Peyton, Rt Hon John


Cordle, John H.
Irvine, Bryant Godman (Rye)
Pink, R. Bonner


Cormack, Patrick
Irving, Charles (Cheltenham)
Powell, Rt Hon J. Enoch


Corrie, John
James, David
Price, David (Eastleigh)


Costain, A. P.
Jenkin, Rt Hon P. (Wanst'd &amp; W'df'd)
Prior, Rt Hon James


Craig, Rt Hon W. (Belfast E)
Jessel, Toby
Pym, Rt Hon Francis


Crawford, Douglas
Johnson Smith, G. (E Grinstead)
Raison, Timothy


Critchley, Julian
Johnston, Russell (Inverness)
Rathbone, Tim


Crouch, David
Jones, Arthur (Daventry)
Rawlinson, Rt Hon Sir Peter


Crowder, F. P
Jopling, Michael
Rees, Peter (Dover &amp; Deal)


Davies, Rt Hon J. (Knutsford)
Joseph, Rt Hon Sir Keith
Rees-Davies, W. R.


Dean, Paul (N Somerset)
Kaberry Sir Donald
Reid, George


Dodsworth, Geoffrey
Kellett-Bowman, Mrs Elaine
Renton, Rt Hon Sir D. (Hunts)


Douglas-Hamilton, Lord James
Kershaw, Anthony
Renton, Tim (Mid-Sussex)


Drayson, Burnaby
Kimball, Marcus
Rhys Williams, Sir Brandon


du Cann, Rt Hon Edward
King, Evelyn (South Dorset)
Ridley, Hon Nicholas


Dunlop, John
King, Tom (Bridgwater)
Ridsdale, Julian


Durant, Tony
Kirk, Peter
Rifkind, Malcolm


Dykes, Hugh
Kitson, Sir Timothy
Rippon, Rt Hon Geoffrey


Eden, Rt Hon Sir John
Lamont, Norman
Roberts, Michael (Cardiff NW)


Edwards, Nicholas (Pembroke)
Lane, David
Roberts, Wyn (Conway)


Elliott, Sir William
Langford-Holt, Sir John
Rodgers, Sir John (Sevenoaks)


Emery, Peter
Latham, Michael (Melton)
Ross, Stephen (Isle of Wight)


Ewing, Mrs Winifred (Moray)
Lawrence, Ivan
Ross, William (Londonderry)


Eyre, Reginald
Lawson, Nigel
Rossi, Hugh (Hornsey)


Fairbairn, Nicholas
Le Marchant, Spencer
Rost, Peter (SE Derbyshire)


Fairgrieve, Russell
Lester, Jim (Beeston)
Royle, Sir Anthony


Farr, John
Lewis, Kenneth (Rutland)
Sainsbury, Tim


Fell, Anthony
Lloyd, Ian
St. John-Stevas, Norman


Finsberg, Geoffrey
Loveridge, John
Scott, Nicholas


Fisher, Sir Nigel
Luce, Richard
Scott-Hopkins, James


Fletcher Alex (Edinburgh N)
McAdden, Sir Stephen
Shaw, Giles (Pudsey)


Fletcher-Cooke, Charles
McCrindle, Robert
Shaw, Michael (Scarborough)


Fookes, Miss Janet
McCusker, H.
Shelton, William (Streatham)







Shepherd, Colin
Stewart, Ian (Hitchin)
Walder, David (Clitheroe)


Shersby, Michael
Stokes, John
Walker, Rt Hon P. (Worcester)


Silvester, Fred
Tapsell, Peter
Walker-Smith, Rt Hon Sir Derek


Sims, Roger
Taylor, R. (Croydon NW)
Wall, Patrick


Sinclair, Sir George
Taylor, Teddy (Cathcart)
Warren, Kenneth


Skeet, T. H. H.
Tebbit, Norman
Watt, Hamish


Smith, Cyril (Rochdale)
Temple-Morris, Peter
Weatherill, Bernard


Smith, Dudley (Warwick)
Thatcher, Rt Hon Margaret
Wells, John


Speed, Keith
Thomas, Rt Hon P. (Hendon S)
Welsh, Andrew


Spence, John
Thompson, George
Whitelaw, Rt Hon William


Spicer, Jim (W Dorset)
Thorpe, Rt Hon Jeremy (N Devon)
Wiggin, Jerry


Spicer, Michael (S Worcester)
Townsend, Cyril D.
Wilson, Gordon (Dundee E)


Sproat, Iain
Trotter, Neville
Winterton, Nicholas


Stainton, Keith
Tugendhat, Christopher
Wood, Rt Hon Richard


Stanbrook, Ivor
van Straubenzee, W. R.
Young, Sir G. (Ealing, Acton)


Stanley, John
Vaughan, Dr Gerard
Younger, Hon George


Steel, David (Roxburgh)
Viggers, Peter



Steen, Anthony (Wavertree)
Wainwright, Richard (Colne V)
TELLERS FOR THE NOES:


Stewart, Donald (Western Isles)
Wakeham, John
Mr. Adam Butler and




Mr. John Stradling Thomas.

Question accordingly agreed to.

Bill read a Second time.

Motion made, and Question put, That the Bill be committed to a Committee of

the whole House.—[Mr. Humphrey Atkins.]

The House divided: Ayes 300, Noes 311.

Division No. 95.]
AYES
[10.16 p.m.


Adley, Robert
Crouch, David
Harrison, Col Sir Harwood (Eye)


Aitken, Jonathan
Crowder, F. P.
Harvie Anderson, Rt Hon Miss


Alison, Michael
Davies, Rt Hon J. (Knutsford)
Hastings, Stephen


Amery, Rt Hon Julian
Dean, Paul (N Somerset)
Havers, Sir Michael


Arnold, Tom
Dodsworth, Geoffrey
Hawkins, Paul


Atkins, Rt Hon H. (Spelthorne)
Douglas-Hamilton, Lord James
Hayhoe, Barney


Awdry, Daniel
Drayson, Burnaby
Henderson, Douglas


Bain, Mrs Margaret
du Cann, Rt Hon Edward
Heseltine, Michael


Baker, Kenneth
Durant, Tony
Hicks, Robert


Banks, Robert
Dykes, Hugh
Higgins, Terence L.


Beith, A. J.
Eden, Rt Hon Sir John
Holland, Philip


Bell, Ronald
Edwards, Nicholas (Pembroke)
Hooson, Emlyn


Bennett, Sir Frederic (Torbay)
Elliott, Sir William
Hordern, Peter


Bennett, Dr Reginald (Fareham)
Emery, Peter
Howe, Rt Hon Sir Geoffrey


Benyon, W.
Evans, Gwynfor (Carmarthen)
Howell David (Guildford)


Berry, Hon Anthony
Ewing, Mrs Winifred (Moray)
Howell, Ralph (North Norfolk)


Biffen, John
Eyre, Reginald
Howells, Geraint (Cardigan)


Biggs-Davison, John
Fairbairn, Nicholas
Hunt, John


Blaker, Peter
Fairgrieve, Russell
Hurd Douglas


Body, Richard
Farr, John
Hutchison, Michael Clark


Boscawen, Hon Robert
Fell, Anthony
Irvine, Bryant Godman (Rye)


Bowden, A. (Brighton, Kemptown)
Finsberg, Geoffrey
Irving, Charles (Cheltenham)


Boyson, Dr Rhodes (Brent)
Fisher, Sir Nigel
James, David


Bradford, Rev Robert
Fletcher Alex (Edinburgh N)
Jenkin, Rt Hon P. (Wanst'd &amp; W'df'd)


Braine, Sir Bernard
Fletcher-Cooke, Charles
Jessel, Toby


Brittan, Leon
Fookes, Miss Janet
Johnson Smith, G. (E Grinstead)


Brotherton, Michael
Fowler, Norman (Sutton C'f'd)
Johnston, Russell (Inverness)


Brown, Sir Edward (Bath)
Fox, Marcus
Jones, Arthur (Daventry)


Bryan, Sir Paul
Fraser, Rt Hon H. (Stafford &amp; St)
Jopling, Michael


Buchanan-Smith, Alick
Freud Clement
Joseph, Rt Hon Sir Keith


Buck, Antony
Fry, Peter
Kaberry Sir Donald


Budgen, Nick
Galbraith, Hon. T. G. D.
Kellett-Bowman, Mrs Elaine


Bulmer, Esmond
Gardiner, George (Reigate)
Kershaw, Anthony


Burden, F. A.
Gilmour, Rt Hon Ian (Chesham)
Kimball, Marcus


Carlisle, Mark
Gilmour, Sir John (East Fife)
King, Evelyn (South Dorset)


Carr, Rt Hon Robert
Glyn Dr Alan
King, Tom (Bridgwater)


Carson, John
Goodhart, Philip
Kirk, Peter


Chalker, Mrs Lynda
Goodhew, Victor
Kitson, Sir Timothy


Channon, Paul
Goodlad, Alastair
Lamont, Norman


Churchill, W. S
Gorst, John
Lane, David


Clark, Alan (Plymouth, Sutton)
Gow, Ian (Eastbourne)
Langford-Holt, Sir John


Clark, William (Croydon S)
Gower, Sir Raymond (Barry)
Latham, Michael (Melton)


Clarke, Kenneth (Rushcliffe)
Grant, Anthony (Harrow C)
Lawrence, Ivan


Clegg, Walter
Gray, Hamish
Lawson, Nigel


Cockcroft, John
Grieve, Percy
Le Marchant, Spencer


Cooke, Robert (Bristol W)
Griffiths, Eldon
Lester, Jim (Beeston)


Cope, John
Grimond, Rt Hon J.
Lewis, Kenneth (Rutland)


Cordle, John H.
Grist, Ian
Lloyd, Ian


Cormack, Patrick
Grylls, Michael
Loveridge, John


Corrie, John
Hall, Sir John
Luce, Richard


Costain, A. P.
Hall-Davis, A. G. F.
McAdden, Sir Stephen


Craig, Rt Hon W. (Belfast E)
Hamilton, Michael (Salisbury)
McCrindle, Robert


Crawford, Douglas
Hampson Dr Keith
McCusker, H.


Critchley, Julian
Hannam, John
Macfarlane, Neil




MacGregor, John
Peyton, Rt Hon John
Stainton, Keith


Macmillan, Rt Hon M. (Farnham)
Pink, R. Bonner
Stanbrook, Ivor


McNair-Wilson, M. (Newbury)
Powell, Rt Hon J. Enoch
Stanley, John


McNair-Wilson, P. (New Forest)
Price, David (Eastleigh)
Steel, David (Roxburgh)


Marshall, Michael (Arundel)
Prior, Rt Hon James
Steen, Anthony (Wavertree)


Marten, Neil
Pym, Rt Hon Francis
Stewart, Donald (Western Isles)


Mates, Michael
Raison, Timothy
Stewart, Ian (Hitchin)


Mather, Carol
Rathbone, Tim
Stokes, John


Maude, Angus
Rawlinson, Rt Hon Sir Peter
Tapsell, Peter


Maudling, Rt Hon Reginald
Rees, Peter (Dover &amp; Deal)
Taylor, R. (Croydon NW)


Mawby, Ray
Rees-Davies, W. R.
Taylor, Teddy (Cathcart)


Maxwell-Hyslop, Robin
Reid, George
Tebbit, Norman


Mayhew, Patrick
Renton, Rt Hon Sir D. (Hunts)
Temple-Morris, Peter


Meyer, Sir Anthony
Renton, Tim (Mid-Sussex)
Thatcher, Rt Hon Margaret


Miller, Hal (Bromsgrove)
Rhys Williams, Sir Brandon
Thomas, Dafydd (Merioneth)


Mills, Peter
Ridley, Hon Nicholas
Thomas, Rt Hon P. (Hendon S)


Miscampbell, Norman
Ridsdale, Julian
Thompson, George


Mitchell, David (Basingstoke)
Rifkind, Malcolm
Thorpe, Rt Hon Jeremy (N Devon)


Moate, Roger
Rippon, Rt Hon Geoffrey
Townsend, Cryil D.


Molyneaux, James
Roberts, Michael (Cardiff NW)
Trotter, Neville


Monro, Hector
Roberts, Wyn (Conway)
Tugendhat, Christopher


Montgomery, Fergus
Rodgers, Sir John (Sevenoaks)
van Straubenzee, W. R.


Moore, John (Croydon C)
Ross, Stephen (Isle of Wight)
Vaughan, Dr Gerard


More, Jasper (Ludlow)
Ross, William (Londonderry)
Viggers, Peter


Morgan, Geraint
Rossi, Hugh (Hornsey)
Wainwright, Richard (Colne V)


Morgan-Giles, Rear-Admiral
Rost, Peter (SE Derbyshire)
Wakeham, John


Morris, Michael (Northampton S)
Royle, Sir Anthony
Walder, David (Clitheroe)


Morrison, Charles (Devizes)
Sainsbury, Tim
Walker, Rt Hon P. (Worcester)


Morrison, Hon Peter (Chester)
St. John-Stevas, Norman
Walker-Smith, Rt Hon Sir Derek


Mudd, David
Scott, Nicholas
Wall, Patrick


Neave, Airey
Scott-Hopkins, James
Warren, Kenneth


Nelson, Anthony
Shaw, Giles (Pudsey)
Watt, Hamish


Neubert, Michael
Shaw, Michael (Scarborough)
Weatherill, Bernard


Newton, Tony
Shelton, William (Streatham)
Wells, John


Normanton, Tom
Shepherd, Colin
Welsh, Andrew


Nott, John
Shersby, Michael
Whitelaw, Rt Hon William


Onslow, Cranley
Silvester, Fred
Wiggin, Jerry


Oppenheim, Mrs Sally
Sims, Roger
Wigley, Dafydd


Osborn, John
Sinclair, Sir George
Wilson, Gordon (Dundee E)


Page, John (Harrow West)
Skeet, T. H. H.
Winterton, Nicholas


Page, Rt Hon R. Graham (Crosby)
Smith, Cyril (Rochdale)
Wood, Rt Hon Richard


Paisley, Rev Ian
Smith, Dudley (Warwick)
Young, Sir G. (Ealing, Acton)


Pardoe, John
Speed, Keith
Younger, Hon George


Parkinson, Cecil
Spencer, John
TELLERS FOR THE AYES:


Pattie, Geoffrey
Spicer, Jim (W Dorset)
Mr. Adam Butler and


Penhaligon, David
Spicer, Michael (S Worcester)
Mr. John Stradling Thomas.


Percival, Ian
Sproat, Iain





NOES


Abse, Leo
Callaghan, Rt Hon J. (Cardiff SE)
Deakins, Eric


Allaun, Frank
Callaghan, Jim (Middleton &amp; P)
Dean, Joseph (Leeds West)


Anderson, Donald
Campbell, Ian
de Freitas, Rt Hon Sir Geoffrey


Archer, Peter
Canavan, Dennis
Delargy, Hugh


Armstrong, Ernest
Cant, R. B.
Dell, Rt Hon Edmund


Ashley, Jack
Carmichael, Neil
Dempsey, James


Ashton, Joe
Carter, Ray
Doig, Peter


Atkins, Ronald (Preston N)
Carter-Jones, Lewis
Dormand, J. D.


Atkinson, Norman
Cartwight, John
Douglas-Mann, Bruce


Bagier, Gordon A. T.
Castle, Rt Hon Barbara
Duffy, A. E. P.


Barnett, Guy (Greenwich)
Clemitson, Ivor
Dunn, James A.


Barnett, Rt Hon Joel
Cocks, Michael (Bristol S)
Dunnett, Jack


Bates, Alf
Cohen, Stanley
Dunwoody, Mrs Gwyneth


Bean, R. E.
Coleman, Donald
Eadie, Alex


Benn, Rt Hon Anthony Wedgwood
Colquhoun, Mrs Maureen
Edelman, Maurice


Bennett, Andrew (Stockport N)
Concannon, J. D.
Edge, Geoff


Bidwell, Sydney
Conlan, Bernard
Edwards, Robert (Wolv SE)


Bishop, E. S.
Cook, Robin F. (Edin C)
Ellis, Tom (Wrexham)


Blenkinsop, Arthur
Corbett, Robin
English, Michael


Boardman, H.
Cox, Thomas (Tooting)
Ennals, David


Booth, Albert
Craigen, J. M. (Maryhill)
Evans, Ioan (Aberdare)


Boothroyd, Miss Betty
Crawshaw, Richard
Evans John (Newton)


Bottomley, Rt Hon Arthur
Cronin, John
Ewing, Harry (Stirling)


Boyden, James (Bish Auck)
Crosland, Rt Hon Anthony
Faulds, Andrew


Bradley, Tom
Cryer, Bob
Fernyhough, Rt Hon E.


Bray, Dr Jeremy
Cunningham, G. (Islington S)
Fitch, Alan (Wigan)


Broughton, Sir Alfred
Cunningham, Dr J. (Whiteh)
Fitt, Gerard (Belfast W)


Brown, Hugh D. (Provan)
Dalyell, Tam
Flannery, Martin


Brown, Robert C. (Newcastle W)
Davidson, Arthur
Fletcher, Raymond (Ilkeston)


Brown, Ronald (Hackney S)
Davies, Bryan (Enfield N)
Fletcher, Ted (Darlington)


Buchan, Norman
Davies, Denzil (Llanelli)
Foot, Rt Hon Michael


Buchanan, Richard
Davies, Ifor (Gower)
Ford, Ben


Butler, Mrs Joyce (Wood Green)
Davis, Clinton (Hackney C)
Forrester, John







Fowler, Gerald (The Wrekin)
Lyon, Alexander (York)
Ross, Rt Hon W. (Kilm'nock)


Fraser, John (Lambeth, N'w'd)
Lyons, Edward (Bradford W)
Rowlands, Ted


Freeson, Reginald
Mabon, Dr J. Dickson
Ryman, John


Garrett, John (Norwich S)
McCartney, Hugh
Sandelson, Neville


Garrett, W. E. (Wallsend)
McEihone, Frank
Sedgemore, Brian


George, Bruce
MacFarquhar, Roderick
Selby, Harry


Gilbert, Dr John
McGuire, Michael (Ince)
Shaw, Arnold (Ilford South)


Ginsburg, David
Mackenzie, Gregor
Sheldon, Robert (Ashton-u-Lyne)


Golding, John
Mackintosh, John P.
Shore, Rt Hon Peter


Gould, Bryan
Maclennan, Robert
Short, Rt Hon E. (Newcastle C)


Gourlay, Harry
McMillan, Tom (Glasgow C)
Short, Mrs Renée (Wolv NE)


Graham, Ted
McNamara, Kevin
Silkin, Rt Hon John (Deptford)


Grant John (Islington C)
Madden, Max
Silkin, Rt Hon S. C. (Dulwich)


Grocott, Bruce
Magee, Bryan
Sillars, James


Hamilton, James (Bothwell)
Mahon, Simon
Silverman, Julius


Hamilton, W. W. (Central Fife)
Marks, Kenneth
Skinner, Dennis


Hamling, William
Marquand, David
Small, William


Hardy, Peter
Marshall, Dr Edmund (Goole)
Smith, John (N Lanarkshire)


Harper, Joseph
Marshall, Jim (Leicester S)
Snape, Peter


Harrison, Walter (Wakefield)
Mason, Rt Hon Roy
Spearing, Nigel


Hart, Rt Hon Judith
Maynard, Miss Joan
Spriggs, Leslie


Hattersley, Rt Hon Roy
Meacher, Michael
Stallard, A. W.


Hatton, Frank
Mellish, Rt Hon Robert
Stewart, Rt Hon M. (Fulham)


Hayman Mrs Helene
Mendelson, John
Stoddart, David


Healey, Rt Hon Denis
Mikardo, Ian
Stott, Roger


Heffer Eric S.
Millan, Bruce
Strang, Gavin


Hooley, Frank
Miller, Dr M. S. (E Kilbride)
Strauss, Rt Hon G. R.


Horam, John
Miller, Mrs Millie (Ilford N)
Summerskill, Hon Dr Shirley


Howell, Denis (B'ham, Sm H)
Mitchell, R. C. (Soton, Itchen)
Swain, Thomas


Hoyle, Doug (Nelson)
Molloy, William
Taylor, Mrs Ann (Bolton W)


Huckfield, Les
Moonman, Eric
Thomas, Jeffrey (Abertillery)


Hughes, Rt Hon C. (Anglesey)
Morris, Alfred (Wythenshawe)
Thomas, Mike (Newcastle E)


Hughes, Mark (Durham)
Morris, Charles R. (Openshaw)
Thomas, Ron (Bristol NW)


Hughes, Robert (Aberdeen, N)
Morris, Rt Hon J. (Aberavon)
Thorne, Stan (Preston South)


Hughes, Roy (Newport)
Moyle, Roland
Tierney, Sydney


Hunter, Adam
Mulley, Rt Hon Frederick
Tinn, James


Irvine, Rt Hon Sir A. (Edge Hill)
Murray, Rt Hon Ronald King
Tomlinson, John


Irving, Rt Hon S. (Dartford)
Newens, Stanley
Tomney, Frank


Jackson, Colin (Brighouse)
Noble, Mike
Torney, Tom


Jackson, Miss Margaret (Lincoln)
Oakes, Gordon
Urwin, T. W.


Janner, Greville
Ogden, Eric
Varley, Rt Hon Eric G.


Jay, Rt Hon Douglas
O'Halloran, Michael
Wainwright, Edwin (Dearne V)


Jeger, Mrs Lena
O'Malley, Rt Hon Brian
Walden, Brian (B'ham, L'dyw'd)


Jenkins, Hugh (Putney)
Orbach, Maurice
Walker, Harold (Doncaster)


Jenkins, Rt Hon Roy (Stechford)
Orme, Rt Hon Stanley
Walker, Terry (Kingswood)


John, Brynmor
Ovenden, John
Ward, Michael


Johnson, James (Hull West)
Owen, Dr David
Watkins, David


Johnson, Walter (Derby S)
Padley, Walter
Watkinson, John


Jones, Alec (Rhondda)
Palmer, Arthur
Weetch, Ken


Jones, Barry (East Flint)
Park, George
Weitzman, David


Jones, Dan (Burnley)
Parker, John
Wellbeloved, James


Judd, Frank
Parry, Robert
White, Frank R. (Bury)


Kaufman, Gerald
Peart, Rt Hon Fred
White, James (Pollok)


Kelley, Richard
Pendry, Tom
Whitehead, Phillip


Kerr, Russell
Perry, Ernest
Whitlock, William


Kilroy-Silk, Robert
Phipps, Dr Colin
Willey, Rt Hon Frederick


Kinnock, Neil
Prentice, Rt Hon Reg
Williams, Alan (Swansea W)


Lambie, David
Prescott, John
Williams, Alan Lee (Hornch'ch)


Lamborn, Harry
Price C. (Lewisham W)
Williams, Rt Hon Shirley (Hertford)


Lamond, James
Price, William (Rugby)
Williams, W. T. (Warrington)


Latham, Arthur (Paddington)
Radice, Giles
Wilson, Alexander (Hamilton)


Leadbitter, Ted
Rees, Rt Hon Merlyn (Leeds S)
Wilson, Rt Hon H. (Huyton)


Lee, John
Richardson, Miss Jo
Wilson, William (Coventry SE)


Lestor, Miss Joan (Eton &amp; Slough)
Roberts, Albert (Normanton)
Wise, Mrs Audrey


Lever, Rt Hon Harold
Roberts, Gwilym (Cannock)
Woodall, Alec


Lewis, Arthur (Newham N)
Robertson, John (Paisley)
Woof, Robert


Lewis, Ron (Carlisle)
Roderick, Caerwyn
Wrigglesworth, Ian


Lipton, Marcus
Rodgers, George (Chorley)
Young, David (Bolton E)


Litterick, Tom
Rodgers, William (Stockton)



Lomas, Kenneth
Rooker, J. W.
TELLERS FOR THE NOES:


Loyden, Eddie
Roper, John
Mr. John Ellis and


Luard, Evan
Rose, Paul B.
Mr. Laurie Pavitt.

Question accordingly negatived.

Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

Orders of the Day — INDUSTRY [MONEY]

Queen's Recommendation having been signified—

Motion made, and Question put,
That, for the purposes of any Act of the present Session to establish a National Enterprise Board, to confer on the Secretary of State power to prohibit the passing to persons not resident in the United Kingdom of control of undertakings engaged in manufacturing industry, and power to acquire compulsorily the capital or assets of such undertakings where control has passed to such persons or there is a probability that it will pass, to amend the Industry Act 1972 and the Development of Inventions Act 1967, to make provision for the disclosure of information relating to manufacturing undertakings to the Secretary of State or the Minister of Agriculture, Fisheries and Food, and to trade unions, and for connected purposes, it is expedient to authorise, subject to the prescribed limits—

(1) the payment out of money provided by Parliament—

(a) of any expenses of the Secretary of State or the Minister incurred in consequence of the provisions of the said Act of the present Session,
(b) of any other sums so payable by either of them, including any increase attributable to the provisions of the said Act in sums payable under any other Act;

(2) the payment out of the National Loans Fund of sums required for making loans to the National Enterprise Board; and
(3) the payment out of the Consolidated Fund of sums required for fulfilling any

guarantee given by the Treasury in respect of sums borrowed by that Board;

and in this Resolution 'the prescribed limits' means—

(a) the limit of £1,000 million imposed by the said Act of the present Session on the aggregate amount outstanding, otherwise than by way of interest, in respect of—

(i) the general external borrowing (as defined in the Act) of the National Enterprise Board and their wholly owned subsidiaries;
(ii) sums issued by the Treasury in fulfilment of guarantees in respect of sums borrowed by the Board from a person other than the Secretary of State;
(iii) sums paid to the Board as public dividend capital (as defined in the said Act); and
(iv) loans guaranteed by the Board othewise than in the exercise of powers conferred on the Secretary of State by sections 7 and 8 of the Industry Act 1972 and exercisable by the Board by virtue of the said Act of the present Session; and

(b) the limit of £1,800 million imposed by virtue of the said Act of the present Session on liabilities of the Secretary of State under guarantees given by him under section 10 of the Industry Act 1972 and section 7 of the Shipbuilding Industry Act 1967;

And that it is expedient to authorise any payment into the Consolidated Fund or the National Loans Fund under the said Act of the present Session.—[Mr. Walter Harrison.]

The House divided:—Ayes 314, Noes, 280.

Division No. 96.]
AYES
[10.30. p.m.


Abse, Leo
Brown, Ronald (Hackney S)
Cunningham, G. (Islington S)


Allaun, Frank
Buchan, Norman
Cunningham, Dr J. (Whiteh)


Anderson, Donald
Buchanan, Richard
Dalyell, Tam


Archer, Peter
Butler, Mrs Joyce (Wood Green)
Davidson, Arthur


Armstrong, Ernest
Callaghan, Rt Hon J. (Cardiff SE)
Davies, Bryan (Enfield N)


Ashley, Jack
Callaghan, Jim (Middleton &amp; P)
Davies, Denzil (Llanelli)


Ashton, Joe
Campbell, Ian
Davies, Ifor (Gower)


Atkins, Ronald (Preston N)
Canavan, Dennis
Davis, Clinton (Hackney C)


Atkinson, Norman
Cant, R. B.
Deakins, Eric


Bagier, Gordon A. T.
Carmichael, Neil
Dean, Joseph (Leeds West)


Barnett, Guy (Greenwich)
Carter, Ray
de Freitas, Rt Hon Sir Geoffrey


Barnett, Rt Hon Joel
Carter-Jones, Lewis
Delargy, Hugh


Bates, Alf
Cartwright, John
Dell, Rt Hon Edmund


Bean, R. E.
Castle, Rt Hon Barbara
Dempsey, James


Benn, Rt Hon Anthony Wedgwood
Clemitson, Ivor
Doig, Peter


Bennett, Andrew (Stockport N)
Cocks, Michael (Bristol S)
Douglas-Mann, Bruce


Bidwell, Sydney
Cohen, Stanley
Duffy, A. E. P.


Bishop, E. S.
Coleman, Donald
Dunn, James A.


Blenkinsop, Arthur
Colquhoun, Mrs Maureen
Dunnett, Jack


Boardman, H.
Concannon, J. D.
Dunwoody, Mrs Gwyneth


Booth, Albert
Conlan, Bernard
Eadie, Alex


Boothroyd, Miss Betty
Cook, Robin F. (Edin C)
Edelman, Maurice


Bottomley, Rt Hon Arthur
Corbett, Robin
Edge, Geoff


Boyden, James (Bish Auck)
Cox, Thomas (Tooting)
Edwards, Robert (Wolv SE)


Bradley, Tom
Craigen, J. M. (Maryhill)
Ellis, John (Brigg &amp; Scun)


Bray, Dr Jeremy
Crawshaw, Richard
Ellis, Tom (Wrexham)


Broughton, Sir Alfred
Cronin, John
English, Michael


Brown, Hugh D. (Provan)
Crosland, Rt Hon Anthony
Ennals, David


Brown, Robert C. (Newcastle W)
Cryer, Bob
Evans, Gwynfor (Carmarthen)




Evans, Ioan (Aberdare)
Lever, Rt Hon Harold
Rodgers, William (Stockton)


Evans John (Newton)
Lewis, Arthur (Newham N)
Rooker, J. W.


Ewing, Harry (Stirling)
Lewis, Ron (Carlisle)
Roper, John


Faulds, Andrew
Lipton, Marcus
Rose, Paul B.


Fernyhough, Rt Hon E.
Litterick, Tom
Ross, Rt Hon W. (Kilm'nock)


Fitch, Alan (Wigan)
Lomas, Kenneth
Rowlands, Ted


Fitt, Gerard (Belfast W)
Loyden, Eddie
Ryman, John


Flannery, Martin
Luard, Evan
Sandelson, Neville


Fletcher, Raymond (Ilkeston)
Lyon, Alexander (York)
Sedgemore, Brian


Fletcher, Ted (Darlingon)
Lyons, Edward (Bradford W)
Selby, Harry


Foot, Rt Hon Michael
Mabon, Dr J. Dickson
Shaw, Arnold (Ilford South)


Ford, Ben
McCartney, Hugh
Sheldon, Robert (Ashton-u-Lyne)


Forrester, John
McElhone, Frank
Shore, Rt Hon Peter


Fowler, Gerald (The Wrekin)
MacFarquhar, Roderick
Short, Rt Hon E. (Newcastle C)


Fraser, John (Lambeth, N'w'd)
McGuire, Michael (Ince)
Short, Mrs Renée (Wolv NE)


Freeson, Reginald
Mackenzie, Gregor
Silkin, Rt Hon John (Deptford)


Garrett, John (Norwich S)
Mackintosh, John P.
Silkin, Rt Hon S. C. (Dulwich)


Garrett, W. E. (Wallsend)
Maclennan, Robert
Sillars, James


George, Bruce
McMillan, Tom (Glasgow C)
Silverman, Julius


Gilbert, Dr John
McNamara, Kevin
Skinner, Dennis


Ginsburg, David
Madden, Max
Small, William


Golding, John
Magee, Bryan
Smith, John (N Lanarkshire)


Gould, Bryan
Mahon, Simon
Snape, Peter


Gourlay, Harry
Marks, Kenneth
Spearing, Nigel


Graham, Ted
Marquand, David
Spriggs, Leslie


Grant John (Islington C)
Marshall, Dr Edmund (Goole)
Stallard, A. W.


Grocott, Bruce
Marshall, Jim (Leicester S)
Stewart, Rt Hon M. (Fulham)


Hamilton, James (Bothwell)
Mason, Rt Hon Roy
Slott, Roger


Hamilton, W. W. (Central Fife)
Maynard, Miss Joan
Strang, Gavin


Hamling, William
Meacher, Michael
Strauss, Rt Hon G. R.


Hardy, Peter
Mellish, Rt Hon Robert
Summerskill, Hon Dr Shirley


Harper, Joseph
Mendelson, John
Swain, Thomas


Harrison, Walter (Wakefield)
Mikardo, Ian
Taylor, Mrs Ann (Bolton W)


Hart, Rt Hon Judith
Millan, Bruce
Thomas, Dafydd (Merioneth)


Hattersley, Rt Hon Roy
Miller, Dr M. S. (E Kilbride)
Thomas, Jeffrey (Abertillery)


Hatton, Frank
Miller, Mrs Millie (Ilford N)
Thomas, Mike (Newcastle E)


Hayman Mrs Helene
Mitchell, R. C. (Soton, Itchen)
Thomas, Ron (Bristol NW)


Healey, Rt Hon Denis
Molloy, William
Thorne, Stan (Preston South)


Heffer, Eric S.
Moonman, Eric
Tierney, Sydney


Hooley, Frank
Morris, Alfred (Wythenshawe)
Tinn James


Horam, John
Morris, Charles R. (Openshaw)
Tomlinson, John


Howell, Denis (B'ham, Sm H)
Morris, Rt Hon J. (Aberavon)
Tomney, Frank


Hoyle, Doug (Nelson)
Moyle, Roland
Torney, Tom


Huckfield, Les
Mulley, Rt Hon Frederick
Urwin, T. W.


Hughes, Rt Hon C. (Anglesey)
Murray, Rt Hon Ronald King
Varley, Rt Hon Eric G.


Hughes, Mark (Durham)
Newens, Stanley
Wainwright, Edwin (Dearne V)


Hughes, Robert (Aberdeen, N)
Noble, Mike
Walden, Brian (B'ham, L'dyw'd)


Huches, Roy (Newport)
Oakes Gordon
Walker, Harold (Doncaster)


Hunter, Adam
Ogden, Eric
Walker, Terry (Kingswood)


Irvine, Rt Hon Sir A. (Edge Hill)
O'Halloran, Michael
Ward, Michael


Irving, Rt Hon S. (Dartford)
O'Malley, Rt Hon Brian
Watkins, David


Jackson, Colin (Brighouse)
Orbach, Maurice
Watkinson, John


Jackson, Miss Margaret (Lincoln)
Orme, Rt Hon Stanley
Weetch, Ken


Janner, Greville
Ovenden, John
Weitzman, David


Jay, Rt Hon Douglas
Owen, Dr David
Wellbeloved, James


Jeger, Mrs Lena
Padley, Walter
White, Frank R, (Bury)


Jenkins, Hugh (Putney)
Palmer, Arthur
White, James (Pollok)


Jenkins, Rt Hon Roy (Stechford)
Park, George
Whitehead, Phillip


John, Brynmor
Parker, John
Whitlock, William


Johnson, James (Hull West)
Parry, Robert
Wigley, Dafydd


Johnson, Walter (Derby S)
Pavitt, Laurie
Willey, Rt Hon Frederick


Jones, Alec (Rhondda)
Peart, Rt Hon Fred
Williams, Alan (Swansea W)


Jones, Barry (East Flint)
Pendry, Tom
Williams, Alan Lee (Hornch'ch)


Jones, Dan (Burnley)
Perry, Ernest
Williams, Rt Hon Shirley (Hertford)


Judd, Frank
Phipps, Dr Colin
Williams, W. T. (Warrington)


Kaufman, Gerald
Prentice, Rt Hon Reg
Wilson, Alexander (Hamilton)


Kelley, Richard
Prescott, John
Wilson, Rt Hon H. (Huyton)


Kerr, Russell
Price C. (Lewisham W)
Wilson, William (Coventry SE)


Kilroy-Silk, Robert
Price, William (Rugby)
Wise, Mrs Audrey


Kinnock, Neil
Radice, Giles
Woodall Alec


Lambie, David
Rees, Rt Hon Merlyn (Leeds S)
Woof, Robert


Lamborn, Harry
Richardson, Miss Jo
Wrigglesworth, Ian


Lamond, James
Roberts, Albert (Normanton)
Young, David (Bolton E)


Latham, Arthur (Paddington)
Roberts, Gwilym (Cannock)



Leadbitter, Ted
Robertson, John (Paisley)
TELLERS FOR THE AYES:


Lee, John
Roderick, Caerwyn
Mr. J. D. Dormand and


Lestor, Miss Joan (Eton &amp; Slough)
Rodgers, George (Chorley)
Mr. David Stoddart.




NOES


Adley, Robert
Amery, Rt Hon Julian
Awdry, Daniel


Aitken, Jonathan
Arnold, Tom
Baker, Kenneth


Alison, Michael
Atkins, Rt Hon H. (Spelthorne)
Banks, Robert







Beith, A. J.
Grimond, Rt Hon J.
Morgan-Giles, Rear-Admiral


Bell, Ronald
Grist, Ian
Morris, Michael (Northampton S)


Bennett, Sir Frederic (Torbay)
Grylls, Michael
Morrison, Charles (Devizes)


Bennett, Dr Reginald (Fareham)
Hall, Sir John
Morrison, Hon Peter (Chester)


Benyon, W.
Hall-Davis, A. G. F.
Mudd, David


Berry, Hon Anthony
Hamilton, Michael (Salisbury)
Neave, Airey


Biffen, John
Hampson, Dr Keith
Nelson, Anthony


Biggs-Davison, John
Hannam, John
Neubert, Michael


Blaker, Peter
Harrison, Col Sir Harwood (Eye)
Newton, Tony


Body, Richard
Harvie Anderson, Rt Hon Miss
Normanton, Tom


Boscawen, Hon Robert
Hastings, Stephen
Nott, John


Bowden, A. (Brighton, Kemptown)
Havers, Sir Michael
Onslow, Cranley


Boyson, Dr Rhodes (Brent)
Hawkins, Paul
Oppenheim, Mrs Sally


Braine, Sir Bernard
Hayhoe, Barney
Osborn, John


Brittan, Leon
Heseltine, Michael
Page, John (Harrow West)


Brotherton, Michael
Hicks, Robert
Page, Rt Hon R. Graham (Crosby)


Brown, Sir Edward (Bath)
Higgins, Terence L.
Paisley, Rev Ian


Bryan, Sir Paul
Holland, Philip
Pardoe, John


Buchanan-Smith, Alick
Hooson, Emlyn
Parkinson, Cecil


Buck, Antony
Hordern, Peter
Pattie, Geoffrey


Budgen, Nicl.
Howe, Rt Hon Sir Geoffrey
Penhaligon, David


Bulmer, Esmond
Howell David (Guildford)
Percival, Ian


Burden, F. A.
Howell, Ralph (North Norfolk)
Peyton, Rt Hon John


Carlisle, Mark
Howells, Geraint (Cardigan)
Pink, R. Bonner


Carr, Rt Hon Robert
Hunt, John
Powell, Rt Hon J. Enoch


Chalker, Mrs Lynda
Hurd Douglas
Price, David (Eastleigh)


Channon, Paul
Hutchison, Michael Clark
Prior, Rt Hon James


Churchill, W. S.
Irvine, Bryant Godman (Rye)
Pym, Rt Hon Francis


Clark, Alan (Plymouth, Sutton)
Irving, Charles (Cheltenham)
Raison, Timothy


Clark, William (Croydon S)
James, David
Rathbone, Tim


Clarke, Kenneth (Rushcliffe)
Jenkin, Rt Hon P. (Wanst'd &amp; W'df'd)
Rawlinson, Rt Hon Sir Peter


Clegg, Walter
Jessel, Toby
Rees, Peter (Dover &amp; Deal)


Cockcroft, John
Johnson Smith, G. (E Grinstead)
Rees-Davies, W. R.


Cooke, Robert (Bristol W)
Johnston, Russell (Inverness)
Renton, Rt Hon Sir D. (Hunts)


Cope, John
Jones, Arthur (Daventry)
Renton, Tim (Mid-Sussex)


Cordle, John H.
Jopling, Michael
Rhys Williams, Sir Brandon


Cormack, Patrick
Joseph, Rt Hon Sir Keith
Ridley, Hon Nicholas


Corrie, John
Kellett-Bowman, Mrs Elaine
Ridsdale, Julian


Costain, A. P.
Kershaw, Anthony
Rifkind, Malcolm


Critchley, Julian
Kimball, Marcus
Rippon, Rt Hon Geoffrey


Crouch, David
King, Evelyn (South Dorset)
Roberts, Michael (Cardiff NW)


Crowder, F. P.
King, Tom (Bridgwater)
Roberts, Wyn (Conway)


Davies, Rt Hon J. (Knutsford)
Kirk, Peter
Rodgers, Sir John (Sevenoaks)


Dean, Paul (N Somerset)
Kitson, Sir Timothy
Ross, Stephen (Isle of Wight)


Dodsworth, Geoffrey
Lamont, Norman
Ross, William (Londonderry)


Douglas-Hamilton, Lord James
Lane, David
Rossi, Hugh (Hornsey)


Drayson, Burnaby
Langford-Holt, Sir John
Rost, Peter (SE Derbyshire)


du Cann, Rt Hon Edward
Latham, Michael (Melton)
Royle, Sir Anthony


Durant, Tony
Lawrence, Ivan
Sainsbury, Tim


Dykes, Hugh
Lawson, Nigel
st. John-Stevas, Norman


Eden, Rt Hon Sir John
Le Merchant, Spencer
Scott, Nicholas


Edwards, Nicholas (Pembroke)
Lester, Jim (Beeston)
Scott-Hopkins, James


Elliott, Sir William
Lewis, Kenneth (Rutland)
shaw, Giles (Pudsey)


Emery, Peter
Lloyd, Ian
Shaw, Michael (Scarborough)


Fairbairn, Nicholas
Loveridge, John
Shelton, William (Streatham)


Fairgrieve, Russell
Luce, Richard
Shepherd, Colin


Farr, John
McAdden, Sir Stephen
Shersby, Michael


Fell, Anthony
McCrindle, Robert
Silvester, Fred


Finsberg, Geoffrey
McCusker, H.
Sims, Roger


Fisher, Sir Nigel
Macfarlane, Neil
Sinclair, Sir George


Fletcher Alex (Edinburgh N)
MacGregor, John
Smith, Cyril (Rochdale)


Fletcher-Cooke, Charles
Macmillan, Rt Hon M. (Farnham)
Smith, Dudley (Warwick)


Fookes, Miss Janet
McNair-Wilson, M. (Newbury)
Speed, Keith


Fowler, Norman (Sutton C'f'd)
McNair-Wilson, P. (New Forest)
Spicer, Jim (W Dorset)


Fox, Marcus
Marshall, Michael (Arundel)
Spicer, Michael (S Worcester)


Fraser, Rt Hon H. (Stafford &amp; St)
Marten, Neil
Sproat, Iain


Freud Clement
Mates, Michael
Stainton, Keith


Fry, Peter
Maude, Angus
Stanbrook, Ivor


Galbraith, Hon. T. G. D.
Maudling, Rt Hon Reginald
Stanley, John


Gardiner, George (Reigate)
Mawby, Ray
Steel, David (Roxburgh)


Gardner, Edward (S Fylde)
Maxwell-Hyslop, Robin
Steen, Anthony (Wavertree)


Gilmour, Rt Hon Ian (Chesham)
Mayhew, Patrick
Stewart, Ian (Hitchin)


Gilmour, Sir John (East Fife)
Meyer, Sir Anthony
Stokes, John


Glyn Dr Alan
Miller, Hal (Bromsgrove)
Tapsell, Peter


Goodhart, Philip
Mills, Peter
Taylor, R. (Croydon NW)


Goodhew, Victor
Miscampbell, Norman
Taylor, Teddy (Cathcart)


Goodlad, Alastair
Mitchell, David (Basingstoke)
Tebbit, Norman


Gorst, John
Moate, Roger
Temple-Morris, Peter


Gow, Ian (Eastbourne)
Molyneaux, James
Thatcher, Rt Hon Margaret


Gower, Sir Raymond (Barry)
Monro, Hector
Thomas, Rt Hon P. (Hendon S)


Grant, Anthony (Harrow C)
Montgomery, Fergus
Thorpe, Rt Hon Jeremy (N Devon)


Gray, Hamish
Moore, John (Croydon C)
Townsend, Cyril D.


Grieve, Percy
More, Jasper (Ludlow)
Trotter, Neville


Griffiths, Eldon
Morgan, Geraint
Tugendhat, Christopher







van Straubenzee, W. R.
Wall, Patrick
Wood, Rt Hon Richard


Vaughan, Dr Gerard
Warren, Kenneth
Young, Sir G. (Ealing, Acton)


Viggers, Peter
Weatherill, Bernard
Younger, Hon George


Wainwright, Richard (Colne V)
Wells, John



Wakeham, John
Whitelaw, Rt Hon William
TELLERS FOR THE NOES:


Walder, David (Clitheroe)
Wiggin, Jerry
Mr. John stradling Thomas and


Walker, Rt Hon P. (Worcester)
Winterton, Nicholas
Mr. Adam Butler.


Walker-Smith, Rt Hon Sir Derek

Question accordingly agreed to.

Orders of the Day — INDUSTRY (FINANCIAL ASSISTANCE)

10.41 p.m.

The Minister of State, Department of Industry (Mr. Eric S. Heffer): I beg to move:
That the Financial Assistance for Industry (Increase of Limit) Order 1975, a draft of which was laid before this House on 31st January, be approved.
Section 8(6) of the Industry Act 1972 stipulates that the aggregate of sums paid plus the liabilities under any guarantee granted under Section 8, exclusive of any liability in respect of interest on a principal sum so guaranteed, and less any sums received by way of repayment, shall not exceed the limits defined in Section 8(7). This provides that the limit shall be £150 million, but may be increased, on not more than four occasions, by order made with the consent of the Treasury, such increases not exceeding £100 million on any occasion.
Section 7, which deals with financial assistance, is principally directed towards the provision, maintenance or safeguarding of employment in assisted areas and is not subject to these limits. The order is therefore concerned solely with sums which the Government have paid or undertaken to pay under Section 8 with the aim of benefiting the economy of any part or area of the United Kingdom and is in the national interest. The aggregate of assistance on the basis defined in Section 8(6) approved since the Industry Act 1972 was granted the Royal Assent now stands at just over £125 million. The Government consider it prudent to invite the House to approve the order increasing the limit from £150 million to £250 million.

Mr. John Stanley: It would help the House greatly, in view of the fact that a large amount of this assistance has been publicised, if the hon. Gentleman will provide the House with a breakdown of the £125 million to which he has just referred.

Mr. Heffer: If the hon. Gentleman will only contain himself I will endeavour to do my best in that direction either a little later in my introductory speech or when I reply to the points that are raised in the debate.

Mr. Michael Heseltine: On the last occasion that the hon. Gentleman's right hon. Friend the Secretary of State for Industry responded to an occasion such as this he told us that he would reply at the end of the debate and give the sort of detailed information that my hon. Friend the Member for Ton-bridge and Malling (Mr. Stanley) requests. Then, with what the right hon. Gentleman regards as a sort of skill, he totally avoided giving answers to the points that had been raised. There will be many orders of this sort coming before the House under the Industry Bill and I must tell the hon. Gentleman seriously that we will not tolerate being treated in this way by him or by his right hon. Friend. We shall resist the orders increasingly and with greater determination unless we are given the facts as we ask for them and as we are entitled to have them.

Mr. Heffer: If hon. Members will only contain themselves I will come to the points that have been raised. I am not trying to avoid any of the questions that will be asked. Hon. Members should also understand that I will not tolerate rudeness from any hon. Member.
The House will wish to be reminded of the schemes of assistance approved to date. There have been two broad industry schemes introduced under Section 8. The first, announced in July 1973, was aimed at encouraging firms in the wool textile industry to improve their production facilities through modernisation of machinery and mills, and to eliminate surplus capacity. The second, announced in November 1973, was designed to help United Kingdom firms to compete with overseas suppliers in the market for goods and services in the United Kingdom sector of the continental shelf. Both of these were introduced by the previous administration, and the total of sums earmarked and payments due on eligible contracts registered stands at some £48 million.
Assistance to individual companies under Section 8 has been granted for the formation of Norton Villiers Triumph and Kearney and Trecker Marwin (Holdings) Ltd., for two projects in support of activities on the United Kingdom continental shelf, and through certain


guarantees. In July 1973, assistance of £4·9 million was provided to set up NVT, and in the same year £1·45 million to Kearney and Trecker Marwin Ltd.

Mr. Peter Rost: Will the Minister confirm what equity stake was made by the Government in NVT?

Mr. Heffer: I cannot offhand give the answer. If I can obtain that information before the end of the debate, I will give it to the hon. Gentleman.
The total expenditure and commitments incurred through proposals advanced by the Conservative administration amount to nearly £55 million.
Since the Labour Government took office, further assistance of up to £3·5 million, mainly in preference shares, has been offered for the formation of Kearney and Trecker Marwin (Holdings) Limited. Offers to a value of nearly £1·2 million have been made to assist in the construction of an oil rig maintenance vessel and a drill ship and guarantees totalling £3·25 million have been made available to the principal bankers of Alfred Herbert Limited and Scientific & Medical Instruments Limited in order to sustain their operations while their longer-term future is settled. The guarantees of £50 million to support BLMC and its subsidiaries, approved by the House on 18th December last, is currently under negotiation with the company and other interests involved.
In addition, £4·95 million was offered under the terms announced by my right hon. Friend on 29th July last year to establish a workers' co-operative to manufacture motor cycles at Meriden, and a resolution seeking the authority of the House for a guarantee of £8 million to NVT stands on the Order Paper. Discussions are well advanced towards the completion of the necessary arrangements to establish the co-operative, and when these have been completed the House will be requested to approve this resolution. The total value of these offers and commitments leaves less than £25 million of the present £150 million uncommitted.

Mr. John Farr: I think that the Minister, probably unwittingly, has left out the £1·75 million promised

to the Scottish Daily Express when certain workers on 27th July 1974 promised to set up a co-operative. Will he say why this sum is not included in the list?

Mr. Heffer: We are talking about Section 8 assistance, not about Section 7 assistance. Section 7 assistance does not come within the present order.
We are currently considering a number of schemes aimed at assisting particular sectors of industry, and there are several companies in discussion about possible assistance to secure their operations. Moreover, there remains the possibility of further unexpected calls upon the Government to support companies eligible for assistance under Section 8. I am sure therefore that the House would not wish the Government's freedom to apply the powers available under this section to such constructive purposes to be inhibited by the current statutory limit.

Mr. Tim Renton: Before concluding his remarks, will the hon. Gentleman give us some idea of the approximate annual profit that might be expected from the £125 million advanced under Section 8?

Mr. Heffer: The hon. Gentleman is asking for more than I can possibly give him now. I am not trying to duck the matter. I do not know the figure. There is no point in my trying to duck anything. However, I shall see whether anything can be done to collect the information. I think that it will prove a difficult job. Nevertheless, if it can be done, I shall let the hon. Gentleman know.
Finally, I ask the House to approve the order.

10.51 p.m.

Mr. Michael Heseltine: The way in which the Minister provided the information was exemplary, and my intervention earlier in the debate was unnecessary. I pay that tribute to the hon. Gentleman. The only justification for my intervention was that, having heard almost the same words from him as I heard from his right hon. Friend in the earlier debate, I was fearful that we were to be treated in the same way. I am delighted that we are not to be so treated and hope that this precedent will be followed in the future.
I should be grateful if the Minister could give us a little information about the £40 million off-shore credit scheme. My hon. Friend the Member for Ton-bridge and Malling (Mr. Stanley) asked for that information in a recent Written Question. The answer did not include information about the £40 million referred to this evening as one of the outstanding liabilities under the Industry Act. I think that it will help to fill in our background knowledge if the hon. Member will include this information when he replies.
The Opposition are anxious about the way in which this money, if it is made available, might be used. It should not be suggested that the Opposition intend to be obstructive over the way in which the Industry Act is used. We rightly put that measure on the statute book. We believed that it had a valuable purpose to play. If properly administered, with the proper safeguards, it will undoubtedly be of value to industry.
Our preoccupation is not with the principle of the work that can be done under the Industry Act, in the last resort, in Section 8 cases. Rather it is with the sort of techniques which the Government have used, both in the substance of the aid that they have given and in the techniques—this point is more significant—that they have used to avoid both public and parliamentary scrutiny of what they have been doing.
Hon. Members may find that the set of dates I intend to give is pure coincidence. However, those hon. Members who have been in Parliament for some time may think that the coincidence to which I now refer stretches the mind to the point of incredulity. On Friday 26th July we heard about the Scottish Daily Express, on Friday 1st November we heard about the IBD, on Friday 6th December about British Leyland, on Friday 13th December about Aston Martin, and on 20th December about Kirkby. If I am to be told that this is not because the Secretary for Industry understands that the national Press on Saturdays reaches a smaller circulation than the publications on Fridays or on any other day of the week, I shall refuse to believe it.
We all know that Ministers have at their disposal the opportunity to present

information to this House at the moment most likely to maximise or minimise its impact. We have all seen that happen. I should be grateful if, in future, the Secretary of State for Industry, his officials or Ministers in the Department would ensure a reasonable spread of coincidence about the dates on which information is disclosed to the House and to the public. At least balance the odds. Give us a break. Let the Press and hon. Members have a chance. The Government have their Fridays. At least give us the odd Monday, Tuesday, Wednesday or Thursday.
I should like to draw the attention of the House to one of the new refinements that the Secretary of State for Industry has developed in this technique of blandishing us with non-information. There was, for example, the way in which the Kirkby statement, which had to be published at the insistence of the Industrial Development Advisory Board, was produced. The right hon. Gentleman knew—I must be frank and declare that the word got to me in advance—that that was what might be termed a hot potato and that it would not be expedient for that information to reach the House of Commons except at the most convenient moment from his point of view.
I got to hear of that situation rather later than the Minister. Therefore, I took the immensely obvious defensive procedure of putting down a priority Written Question on the Monday before the House rose for the Christmas Recess because I knew that it would have to be answered on the Thursday. I asked whether the Secretary of State for Industry would make a statement about the information that he had about the Kirkby co-operative. On the Thursday I got the answer. The right hon. Gentleman said:
I am arranging for a statement to be laid before the House before the recess."—[OFFICIAL REPORT, 19th December 1974; Vol. 883, c. 580.]
I need not point out to hon. Members that the House was rising on the following day.
I did not even get the Answer to that Question on the Thursday until well past the normal time for getting Answers to Questions. I had to ring the right hon. Gentleman's Department at five o'clock to ask where my priority Written Answer was. Needless to say, I was here at


11 o'clock on the Friday morning waiting for the answer in the form of the statement that I knew had to come. But it did not arrive. Therefore, at twelve o'clock and one o'clock, when it still had not come, I decided to try to get it through the usual channels. I then had some lunch. I was not diligent between one o'clock and two o'clock. But by two o'clock I was back on duty, and by that time the answer had arrived.
I have to tell hon. Members that the staff of this House were at that time in some state of merriment not in any way associated with the issue of the Kirkby document. Even the Press Gallery was not quite as attentive to its duties as it might normally be.
The Secretary of State hoped that he had achieved the ultimate objective of releasing the least palatable piece of information about the Industry Act at the most harmless moment that he could conceivably have chosen.
I have set out the record at some length, not without a certain amount of admiration for the duplicity with which the right hon. Gentleman informed us of the situation, because it shows what politicians who believe in the art of politics as opposed to anything else are capable of doing when they put their minds to it. If the right hon. Gentleman spent more time on the problems of British industry than on Parliament, British industry would be better off. We have seen through him and would be grateful if in future he would not try it again.
I turn next to another area of accountability and mistreatment under the Act. I refer to the treatment of the Industrial Development Advisory Board. The Board was set up because, as we know from the two-day debate on the Industry Bill, politicians are likely to interfere, for curious reasons, in the disposal of funds at their command. Therefore, Parliament in its wisdom—the Paymaster-General was right to point out that it was pressure from outside, not from Parliament itself—put the safeguard of the Industrial Development Advisory Board and other measures into the Industry Act 1972.
It has not been convenient for the Secretary of State for Industry to find

any form of discipline imposed on the way that he disposes of the funds made available to him under the Act. Therefore, when the Court Line situation arose he did not take the trouble to consult his advisers, although statutorily he should have done so. When Harland and Wolff was to receive money, the Minister of State, Northern Ireland Office, told the House that it was not even necessary to consult the Industrial Development Advisory Board.
Then we had the Kirkby situation. We know that the Board insisted on its voice being heard, but its advice on Meriden, the Scottish Daily Express and Alfred Herbert was ignored.
What happened to Meriden? A year has gone by and the co-operative still is not under way. Are we honestly being told—

The Under-Secretary of State for Industry (Mr. Michael Meacher): Meriden?

Mr. Heseltine: Yes, Meriden. The hon. Gentleman may have forgotten because it must be a long time since he looked at the papers. When is Meriden likely to go into production? I am delighted that the Minister of State reminded the Under-Secretary that it is not functioning. This is a year later. A great deal of negotiation has gone on and files have been filled up. The one thing that we are concerned about is the production of motor cycles, and that is not happening. I am not sure what the commitment of the taxpayer is—£13 million or £16 million?—but not one motor cycle has been produced. I should like to know when a motor cycle is made at Meriden. I do not ask for a financial return. If I could get a motor cycle from Meriden, I would be satisfied.
I see that there has been another postponement of the terms in the case of the Scottish Daily Express. How much delusion are the members of the present Government prepared to impose on those people in Scotland who are encouraged to commit their money to a project which hon. Members opposite must know is an odds-on favourite for costing them the capital which they have obtained from their redundancy payments? That is what the Government are doing. They are encouraging those people in the Scottish Daily Express who have been


made redundant and have received redundancy payments to "blow" it on a wild whoopee. Let us hear a bit more about the justification for that, and a few assurances that we shall not have any more of that in the future.
The fact that this is an order made under the 1972 Industry Act ought to have drawn us on to common ground. If one thing has come out of the debates that we have had in the last two days, I understand that it is the overwhelming view of everybody in this House that we should try to find sensible, practical, realistic and relevant proposals to deal with British industry, and not the doctrinal claptrap that we have heard from hon. Members opposite. I should have thought that the Industry Act, which gave us the opportunity to help industry in the most flexible way possible, would have provided a meeting ground on which we could give to industry the sort of basic and certain framework which it has been crying out for all these years.
Not a bit of it. The Division that we had tonight made certain that the Committee will deal with any proposal for the removal of all the safeguards which the industry insisted on having in the 1972 measure to stop the meddling by politicians. We have had not a word of justification except the doctrinal one. We heard that there would not be enough flexibility. I do not know where there has been any failure to have flexibility. Perhaps we could have a word about that, though it would probably be more appropriate in Committee.
My concern with this order is twofold, apart from what I have already said. First, I am concerned that if the Bill we debated tonight becomes law, it will now be possible that this Section 8 money will be made available to companies without the safeguards which are built into the 1972 legislation. I must make it clear on behalf of the Opposition that when we become the Government of this country we shall seek to dispose of the shares taken into public ownership under the new powers which are being taken in the amended 1972 legislation which the House debated tonight.
One last word on the question of abuse of parliamentary accountability and the misuse of taxpayers' money. Although I understand that the Kirkby situation

comes under Section 7 of the Industry Act, it is important that the sort of standards that have been applied in the Kirkby case should be put clearly on the record and that the public and those whose duty it is to scrutinise our behaviour here should understand what has gone on.
This must not become a precedent. It may be that the Secretary of State for Industry needs to have a sort of totem pole around which to dance like a wild Dervish, but it is an intolerable way of going on in the efficient management of the economy. I ask the Minister of State to tell us whether he believes that the precedent of Kirkby is one which he would be prepared to use in considering Section 8 cases.
Perhaps I can put briefly to the House what has happened in Kirkby. The loans made to Meriden and the Scottish Daily News are repayable to the Department of Industry. No such position exists with the repayment of the Kirkby money, except in the case of the liquidation of the co-operative that has now been formed. Why is it that this should be the case? The Secretary of State told the House that the grant to KME becomes repayable if the co-operative fails. He was giving the impression that there was the same sort of security as applies to Meriden and the Scottish Daily News. Anyone following the issue would, on the precedents available, have assumed that there was security.
With the loan to the Scottish Daily News, the Government rank pari passu with all secured lenders, after priority creditors. In the Meriden venture the Secretary of State has a first charge on the assets of the co-operative. In those two cases, one involving a Section 8 order, there was a safeguard for the State's money. With the Kirkby grant there is a safeguard only if it goes into liquidation, and then the Government rank after all other secured and unsecured creditors of the co-operative. That is unquestionably a case of misleading the House.
If the Kirkby co-operative runs into difficulties and incurs losses, when the liquidation takes place the money will go first to the creditors and then to pay off the losses. There will be no question of the grant from the State being secured.


We shall get what is left. With Meriden or the Scottish Daily News we get first, or equal, precedence. Why was that situation allowed to develop? What is the difference between these undertakings? This is an important question.
I should be obliged if the Minister of State would listen to me rather than talk to his hon. Friend the Under-Secretary. He may well find himself before the Public Accounts Committee or the Expenditure Committee dealing with this, so he had better find answers to my questions. I am trying to warn him publicly. The first instalment of the KME grant has been paid. As far as we can establish from Written Answers, the co-operative framework has not yet been finalised. The consequence is that the money has been paid into a company the sole shareholders of which are Messrs. Spriggs and Jenkins. There is no restraint, as I understand it, on the transfer of the shares which they own.
I make it clear that I have no intention of casting any aspersions on the integrity of these two persons. I am merely concerned with the issues of public accountability. The Government have handed over £2 million, quite free, to a privately-owned company before the proper constitution of that company has been established. If that is not an issue which ought to be investigated by the House, I do not know what is.
It is sad that an Act which should have united the House in a common purpose should be so used. On two occasions we have seen the Secretary of State in trouble. He was hauled before the Ombudsman for his misuse of the Act in relation to Court Line. I will not prejudge any findings there. On the second occasion we have, with Kirkby, a precedent which will, I hope, be examined by the PAC and the Expenditure Committee. It is an intolerable situation for the right hon. Gentleman to put himself in. He continually finds that an outside body has to come in and monitor his work because Parliament is unable to find out effectively and quickly the full facts, which he has hidden behind a range of answers which evade the truth to the maximum degree possible.
I believe that the Government are guilty of misusing the Act. It is a sad reflection

on their inability and a confirmation of our belief that the Labour Party are playing this game for political reasons rather than for industrial reasons.

11.11 p.m.

Mr. Geoffrey Dodsworth: I am grateful to my hon. Friend the Member for Henley (Mr. Heseltine) for outlining the detailed facts which give cause for concern about the control of expenditure and particularly about the way in which funds are provided under an affirmative order, as in this case.
The other cause for congratulation is that we have heard a rather more original view of the reasons for satisfaction with the affirmative order procedure. Normally, as under the Public Works Loan Board, the Prices Act and the Export Guarantees Amendment Bill the Minister said that it was a matter of administrative convenience, that they were only concerned to save our valuable time and that we need only approve the Bill and the order would appear in due course. It was said that we need not worry our pretty heads because we could be sure that the Treasury and other Government Departments would satisfy themselves that expenditure was properly and legitimately carried out. We have heard clear and ample evidence that we cannot rely on that at all. It is more than a purely administrative matter, more than a purely departmental matter. It is a test of parliamentary control which we should maintain on expenditure and affairs.
We have to see that we have a proper method of approval and control. I am grateful that the question was asked—how has the money been spent so far? It is a peculiarly difficult question to which to obtain an answer. On a number of occasions I have tried to find a definitive list of firms with orders and the money spent. I have placed Questions to all the appropriate Departments to satisfy myself on that point. I shall look forward to the answers with interest. They will no doubt cause further Questions.
There should be a monitoring of the industries involved in this Department. Here we do not just have expenditure of money as in the case of subsidies but a continuing involved situation, and there is an obligation on the part of the Government to satisfy themselves that the


ongoing activity is continually monitored. We should ask ourselves about the reporting procedure required so that the House and the Department can be fully informed.
The case to which my hon. Friend the Member for Henley referred clearly demonstrated the difficulties where there was disagreement with the Industrial Advisory Board and complete disregard of the correct procedures and of all the facts and information which would lead to more normal business judgment. All this leads one to wonder whether the most extensive powers in the Industry Bill will not make it more difficult for us in the future.
I tried to add up the sums of money involved. It is worth carrying out that exercise, because although we are covering £100 million added to £150 million, we have to look at the totals involved. An examination of the Bill shows that we had originally approved £1,550 million. When the Bill becomes law that will become £2,350 million, but it could be increased by subsequent orders to £3,450 million.
We have an escalation in the activities of the State which are contained by combining the current approvals with possible approvals, depending on whether the Government can succeed in persuading the House that the Bill which received a Second Reading today should become law. Clause 7 approves £700 million, and that can be increased to £1,000 million by order. Clause 16 has £1,000 million which is now increased to £1,400 million, and will or can be increased in the future to £1,800 million. There is a prior approval in the matter, but I mention it as it is contained in Clause 16. Under this order we have an increase of £100 million.
We have a total situation of substantial and massive amounts of money for which the Department is responsible. I took a brief opportunity to see the resources that were available. Can we say that in this Department we have the men and the methods, because we can see that it is determined to have the money?
The resources of the Department of Industry are 4,746 people. Of those, 1,992 are in the scientific grade. We might run through some of the people

who may be expected to deal with this large sum of money and the intermittent detailed matters of business and commercial administration that are necessarily involved. There are 36 economists, 66 statisticians—that is historical I think—but—and my hon. Friend the Member for Henley will appreciate this—there are 73 information officers. There we have the men for the job in the Department—73 information officers.
I agree that this Department is well blessed with professional accountants. It is better served than the Treasury, which has succeeded in having one professional accountant out of a total staff of 1,189. The Department of Industry has 81 accountants, eight of them of senior director, director or assistant director grade, and 73 chief accountants. When one considers that this Department has activities spread throughout the whole of British industry and that this is the level of professional acumen which it seeks to acquire, one sees that there is a pretty poor prosepct for this country with the expenditure of these vast sums of money.
I shall not detain the House any longer, except to say that here is a matter which is a grave and sad reflection on the way in which large sums of money will be administered in the future. It is a matter to which we shall have to address ourselves in much more detail to satisfy ourselves that we are discharging our proper duty of parliamentary control.

11.18 p.m.

Mr. Nick Budgen: This order illustrates the Minister's preference for what he calls public expenditure, that is to say, public investment which can be made for political and social objectives.
For the last two days the House has been debating the failure of investment, and various ideas have been put forward about why there has been a lamentable failure in investment over the last few years. Labour Members have spoken about the inability of the City to face its national responsibilities. They have talked about the need for more investment because the country wants more growth. But they have failed to recognise that investment is not made for fun. Investment is not made for social objectives alone. Investment is generally made on behalf of other people, and it is made in


the expectation of profit. This expectation of profit is what we mean by confidence, and the unhappy fact is that the Government have added one more factor which inhibits confidence and which will in the future prevent private investment in industry.
Among the traditional factors which have inhibited confidence have been the variety of attitudes of Government to profit. These have varied from something between guilt and outright hostility. Successive Governments have also failed to control inflation. As a result "guesstimates" have been extremely difficult to make. There has been persistent direct interference by Government in industry—interference in the form of taxation, dividend and price control, and the subsidising of nationalised industries. The debate tonight illustrates a new and more terrible danger which will inhibit confidence to invest. Until the Government came to power, industrialists believed that politicians would certainly not encourage people to break the law. But I wonder whether any industrialist today would be certain that he could trust the Secretary of State for Industry, with all his self-righteousness to fulfil his most important duty not to encourage workers to break the law.
By his attitude to sit-ins the Secretary of State has further undermined the rule of law. He has attempted to achieve what he calls industrial democracy by any means within his power. At the beginning of the sit-ins at the Upper Clyde he told the workers there during a visit that they had done more in 10 weeks to advance the cause of industrial democracy than all the blueprints he and his colleagues had worked on for the previous 10 years.
He failed to realise that a sit-in is no more than an illegal occupation by workers of premises they do not own. There has been no word of condemnation from his lips of the illegality of sit-ins. When in August 1974 he went to a banquet held by the Lord Mayor of Coventry he preceded the banquet by addressing 400 men at the premises of Norton-Villiers-Triumph at Meriden. He had the effrontery to say that the wigwam and brazier which had been used to sustain the gallant and noble workers who

had operated that illegal sit-in throughout the winter were objects which should be retained for posterity as an example of human achievement.

Mr. Deputy Speaker (Mr. Oscar Murton): I do not wish to interfere in the speech which the hon. Member is making, but I must point out that it is not in order to discuss the merits of financial assistance to industry under the order. It is, however, in order to discuss the nature of past and likely future expenditure, but the principle itself is already established.

Mr. Bugden: I accept that the principle is established, but I refer only to the effect of expenditure upon other principles. The principles to which I am devoting my remarks are the principle of the rule of law and the principle of industrial harmony.
By undermining the rule of law the Secretary of State has stirred up class hatred and enmity. More than that, he has stirred up hatred between management and government, and he has introduced a further factor which will inhibit investment. In many parts of my constituency there are proud records of industrialists giving very full information to their workers in the hope that if the trade cycle works against them and they unhappily must declare men redundant, they will find that by their information they have given men advance warning of difficult times ahead.
As a result of this expenditure, as a result of the Secretary of State's attitude, less disclosure will be made, because industrialists throughout the land will fear that sit-ins will take place, encouraged by this Government.

11.25 p.m.

Mr. Tim Renton: Like my hon. Friend the Member for Hertfordshire, South-West (Mr. Dodsworth), I wanted to speak in this debate because time and again many of us on the Opposition benches have failed to obtain any reply from the Government to Oral and Written Questions on how the sums of money granted under Section 8 of the Industry Act were being used. We have been told that it was not customary, that it was unnecessary, that it was against normal commercial practice, to give information about the profitability


of the companies to which the money was going, or about their production.
But we are now talking of at least £125 million advanced under the section. The House is short of information on how it will be used and what yield the taxpayer may eventually expect from it My hon. Friend the Member for Henley (Mr. Heseltine), with his customary modesty, said that he merely wanted a motor cycle from Meriden. I agree with him, but I would go a little further and say that when we are talking of at least £125 million it is reasonable to ask for an idea of the profit and the plans, and of the eventual benefit to the country from that sum.
When I intervened earlier the Minister of State said that he was unable to give any answer of that kind. I hope that by now he has received some help from his officials in the box, and that when he winds up the debate he will be able to give us a little information. Otherwise, this is a sad prelude to the much greater sums that will be committed under the Industry Bill. If we can get no guidance from the Minister as to the sort of return that may come on these relatively small sums, how much worse will be the situation when the Secretary of State has committed hundreds of millions of pounds?
I have two specific points on which I hope that the hon. Gentleman will be a little more clued up than he was in answer to my earlier intervention. The first concerns the Offshore Supplies Office, set up, I believe, under Section 8.

Mr. Heffer: The office does not happen to come under the Department of Industry. It comes under the Department of Energy, so the hon. Gentleman is not particularly clued up either.

Mr. Renton: I thank the Minister for helping me on that. I move straight to my second point, which concerns the inter-relationship between the order and the Export Guarantees Amendment Bill, the Second Reading of which was debated last week. I was amazed to read in last week's Economist the statement that Meriden sitters-in would soon get their £4·8 million Government loan, once the export credit guarantee was approved by Parliament. That is a matter that all of us who debated that Bill were worried

about. The Bill contained many new powers for grants to be made to any persons, not just any banks, in furtherance of British exports. Like my hon. Friend the Member for Tonbridge and Malling (Mr. Stanley) and others, in that debate I asked the Under-Secretary for Trade whether he could assure us that export credits would be made available only for commercially viable propositions. Three days later, we read in the Economist that an export credit guarantee might be made available to Meriden and that that would further the wishes of the Department of Industry in making grants available to that company.
The inter-relationship between this order and the Export Guarantees Amendment Bill is a matter about which we must have an explanation, otherwise we see a situation developing in which one Government Department is encouraged to ensure uncreditworthy export risks so that the Department of Industry can go ahead with advancing more of the taxpayer's money for schemes which from the start are unprofitable and commercially unviable.
In the case of Meriden, the Industrial Development Advisory Board advised that it was not a viable proposition. Will the Minister confirm that he will not lean on his friends in the Department of Trade to make them provide export guarantee facilities which will get him and his right hon. Friend out of some of the difficulties which they are in as a result of the loans they have made?

11.31 p.m.

Mr. Bob Cryer: Before this organised hypocrisy from the Opposition goes much further, perhaps we might get a few facts on the record.
The Opposition talk about parliamentary control. What were they thinking about only a few years ago when they took this country into the European Common Market and handed over parliamentary control to the bureaucrats in Brussels? They do not say anything about that tonight—

Mr. Budgen: On a point of order, Mr. Deputy Speaker. If I were moving away from the terms of the order, I think that the hon. Member for Keighley (Mr. Cryer) is even further away.

Mr. Deputy Speaker: This is entirely a matter for the Chair. I wish to see how the hon. Member for Keighley (Mr. Cryer) develops his argument before deciding whether he is moving wide of the order.

Mr. Heseltine: It so happens that I remember what I was thinking about as I voted in favour of the motion to which the hon. Gentleman referred. It was the words, "We will negotiate our way in, and we will not take 'No' for an answer." It was the Prime Minister who said that.

Mr. Cryer: I am grateful for that intervention, because it authenticates my original remark. Of course, there was controversy in the Labour Party about entry into the Common Market. I do not dwell upon it, because I do not want to get out of order, but I must answer the hon. Member for Henley (Mr. Heseltine). Of course there was controversy. But in 1970, the Conservative Government said that they would negotiate, and no more—

Mr. Deputy Speaker: Order. I must request the hon. Gentleman to keep within the terms of the order.

Mr. Cryer: I must point out that there was no whole-hearted consent by the British people to go into the European Common Market and that it is the height of effrontery and hypocrisy for the Opposition now to talk about parliamentary control. I happen to think that it is important, and from time to time I have drawn attention to matters affecting parliamentary control, but it is hypocritical for the Opposition to say that we need it now, when it suits their convenience, although it can be thrown out of the window when we go into Europe.
The money which we are asked to authorise has gone to rescue ventures which in the ordinary capitalist sense have failed, just as the level of investment in the whole of industry has failed when it has been in the hands of the private owners of capital.
It is apparent from some of the remarks that we have heard that the Opposition are quite prepared to withstand rising unemployment. We have had hon. Members inveighing against workers who are no longer prepared to doff their caps meekly to their bosses and walk through

the door. They have been prepared to sit in, to use their initiative, to develop their spirit, and to form co-operatives. No one denies that there are difficulties in forming these co-operatives, but many Opposition Members will look sick when they are successful. The tenor of their remarks is quite clear. They do not want the co-operatives to be successful. They do not want Kirkby, Meriden or the new daily newspaper to be successful. They would gloat at failure. It ill becomes a party which purports to represent the nation and the finest spirit—

Mr. Deputy Speaker: Order. I requested the hon. Member for Wolverhampton, South-West (Mr. Budgen) to keep within the terms of the order. The hon. Member for Keighley (Mr. Cryer) is straying from them. I asked him to confine himself to the order. He must not discuss the merits of financial assistance to industry in principle. He must speak to the order, including, if he so wishes, past and likely future expenditure.

Mr. Cryer: I am grateful to you, Mr. Deputy Speaker, because in the past the merit of granting this money under the Industry Act 1972, which was passed by the Conservative Government, was not in question. Hon. Members of the Opposition are merely political opportunists seeking whatever straw they can find in order to try to discredit the present Labour Government.
I hope that this extra money will be spent in the way in which it has been spent in the past—in helping people to form co-operatives. Co-operation has a long and distinguished history. It is developed in this country and provides a very large proportion of retail distribution.
If we can set a productive co-operative torch alight, the Opposition are doomed indeed, because earlier tonight—I hope, Mr. Deputy Speaker, that I am keeping within the rules of order—their lackluster performance indicated that their ideology is in a very sad state. If co-operative development agencies such as those which have been financed under these provisions in the past—and hopefully will be in the future—are successful, hon. Members opposite will be condemned to the Opposition benches for all foreseeable time.
I want to make another comment about the sort of expenditure which can occur in the future. My hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) has been involved today with the formation of a concern relating to Imperial Typewriters. My hon. Friend the Member for Bolsover (Mr. Skinner) has also been involved in this very worthy cause.

Mr. John Prescott: We shall be directors.

Mr. Cryer: That typewriter factory has been unilaterally closed by the decision of a tiny number of directors in a board room entirely remote from the work force and the workshops. If those workers acting in concert can set up a British typewriter production and assembly line and rescue that industry, surely both sides of the House should welcome it.
One of the ways in which we can prevent the domination of foreign capital in this country is by British people actually directing investment to their own productive facilities. It is extraordinary that the Opposition should find no objecton to American or Arab capital flowing in. The Americans and Arabs can come here and buy up what they like. But when it comes to an order increasing the money available for our own Secretary of State to extend the British people's ownership of the means of distribution and production, the Opposition object to that.
This order and the co-operatives which have been financed have kindled a torch in this country. My hon. Friends and I believe that once kindled, that torch will never be put out.

11.40 p.m.

Mr. Peter Rost: There is no doubt that the House must reject this order. If it had needed any further convincing I think that the hon. Member for Keighley (Mr. Cryer) would have provided it.
There is no question but that it would be highly irresponsible for the House to grant even another pound to the Department of Industry, yet alone another £100 million. The evidence is accumulating the whole time. The Department of Industry has already abused the Industry Act 1972 and it is obviously intending

to abuse it further. The issues of parliamentary responsibility and accountability are the most important matters that the House has to consider. There can be no doubt that the Government intend indiscriminately to grant themselves public funds through Parliament, to avoid accounting for the expenditure and to spend the money in a way which will allow them to pursue their political objectives.
I do not want to be held responsible for granting another £100 million so that the Secretary of State for Industry can go on adding to his personal portfolio of unviable speculations at the expense of the taxpayer. It is time that the House took a grip of itself and called a halt.
I ask the Minister three specific questions relating to past expenditure under the Act and projected expenditure. First, why is it that some of the expenditure past and future that is going to workers' co-operatives will be granted without any equity stake being taken in return? Why is it that no equity is being taken yet the Government regard it as right to pilfer equity from private enterprise in any way that they can through the Industry Bill or by other means? Why is it that no equity is being taken from the co-operatives that are being set up—

Mr. Tom Litterick: On a point of order, Mr. Deputy Speaker. The hon. Member for Derbyshire, South-East (Mr. Rost) has referred to the "personal portfolio" of my right hon. Friend the Secretary of State for Industry and has used the word "pilfer". I understand by the ordinary use of the English language that "personal portfolio" means something very personal and that "pilfer" implies something criminal—

Mr. Deputy Speaker: I believe that the hon. Member for Derbyshire, South-East (Mr. Rost) used the terms as generalities. I am sure that the hon. Gentleman did not intend to refer to the Secretary of State's portfolio in the manner that has been suggested.

Mr. Rost: I am grateful, Mr. Deputy Speaker. I do not wish there to be any misunderstanding. Perhaps I may change "private" to "political". I refer to the political portfolio of the Secretary of State.

Mr. Litterick: What does that mean?

Mr. Rost: I am sure that Labour Members know very well what it means, as do my hon. Friends
Why is it right that no equity should be taken by the taxpayers in the workers' co-operatives? In most cases it is the taxpayer who is granting the funds and taking all the equity risk. Yet the equity is to be taken by the Government for other grants to be provided under the new Industry Bill.
Secondly, why is it that in the case of the Kirkby co-operative the taxpayer cannot win? Why is it that the grant which is being given to the co-operative does not have to be repaid except in the event of liquidation, in which case nothing will be repaid? If the co-operative happens to succeed—not that any of us believe that that is possible—and becomes profitable, why is it that the taxpayer will not get back his loan? Is the Minister suggesting that the grant that is being provided by the taxpayer to the co-operative is on a one-way basis? If the co-operative succeeds the taxpayer is not to be repaid, and the whole of any profit that might result from the loan will accrue to the shareholders entirely without any liability to repay the loan. The House is entitled to an explanation why the taxpayer loses both ways and has no way of being repaid.
My third point refers to projected future expenditure. There are rumblings going around that the next workers' co-operative will be at the Imperial Typewriter premises at Leicester and Hull. Again the House is entitled to know on what basis any grant will be made to that project. Will it be made only if the feasibility study—a study which is now being undertaken independently at the Government's request and which presumably will be published—concludes that it is a viable project? I hope the Minister will give a firm undertaking that no more public money will be sunk into co-operatives, or any other ventures unless an independent feasibility study at least gives to a scheme the benefit of the doubt, justifying speculative investment. Therefore, if we are to have any accountability at all, one of the first objectives is to get an undertaking from the Minister.
I believe that we should reject the idea of handing this further amount of funds to the Government. They have acted in a highly irresponsible manner so far and this will give them further licence for irresponsibility.

11.47 p.m.

Mr. William Molloy: I shall be very brief. I should like to give an example of one situation in my constituency which should help Opposition Members to understand what is meant by the order.
Had this order existed 18 months ago, the British glass container industry might not have lost a vital part of its organisation which used to exist in my constituency and which has now gone to Western Germany—[Interruption.] One expects that sort of reaction from the hon. Member for Henley (Mr. Heseltine), with his hatred of anything that happens to be British. He should get up to challenge what I am saying rather than laugh derisively from a sedentary position—which, come to think of it, perhaps is the best position for the hon. Gentleman to occupy.
Let us consider what would have happened had this order existed a year or so ago. A firm in my constituency called Rockware Glass had existed there for many years with no industrial problems whatever. Indeed, in a troublesome period in the 1930s workers, in efforts to save the firm, worked for a month without wages. However, a few years ago, as a result of the predatory efforts of Slater Walker, Rockware Glass was compelled to sell a large factory and to take steps to protect two others. The result was that the United Kingdom lost a large factory in my constituency which had been engaged in producing glass containers, and nearly a thousand skilled craftsmen lost their jobs. That trade then went from Great Britain to another country in the Common Market—no doubt to the delight of the hon. Member for Henley who at that time had some responsibility in those matters. Middle and top level management and the trade unions asked me to see whether anything could be done to help. Nothing could be done. If this order had existed, something could have been done to save a vital part of British industry.

Mr. Deputy Speaker: The hon. Member is indulging in references to a hypothetical situation. The order did not exist at that time. We are now discussing this order. The hon. Member should confine himself to the order as it stands.

Mr. Molloy: With respect, Mr. Deputy Speaker, there is nothing hypothetical about a thousand men being thrown out of work.
This is my contribution. If this order had existed some years ago, the disaster which hit my constituency and the glass container industry of Great Britain could have been avoided.

11.52 p.m.

Mr. John Farr: I support what my hon. Friend the Member for Henley (Mr. Heseltine) said concerning the diffidence if not the disdain of Ministers in the Department of Industry with regard to the workings of the Industry Act 1972.
My hon. Friend gave illustrations of the difficulty he had in getting through to the Minister's Department. I can do better than that, because on 29th July 1974 I took the precaution of officially giving notice to the Secretary of State for Industry and the Department that we would raise in the debate on whether the House should rise for the Summer Adjournment the question of aid to the Scottish Daily Express and the Meriden co-operative. Those matters were raised by several hon. Members between 3.30 p.m. and 6.30 p.m. on that day. Not one Minister from the hon. Gentleman's Department bothered to turn up. There was no response to the many speeches made. I regard that as a disdainful attitude which characterises some of the statements made by the Minister and by his colleagues.
A considerable sum of money is involved, since the limit is to be raised to £250 million. Under the Industry Act a further £300 million can be raised by further Parliamentary Order. The total support authorised by Section 8 (7) of the 1972 Industry Act amounts to £550 million to be used as the Minister sees fit.
The Opposition object to the fact that the safeguards in Section 9 of that Act are ignored. Section 9 laid down the procedure whereby the Industry Develop-

ment Advisory Board was to be consulted if it was proposed to make funds available under Sections 7 and 8 of the 1972 Act. One might say that that is a sound procedure. However, the Secretary of State for Industry, after consulting the Board, repeatedly ignores its advice and flies in the face of the experts, thereby placing public money at risk in one dubious enterprise after another.
If the Minister is to continue coming to Parliament for authority to raise another £100 million and then £200 million under this section, I feel that the next time he comes along, if not today, although it is a Conservative Act, we must say that enough is enough and that no more money must be made available unless he undertakes to accept and to be guided by the expert advice available to him, under Section 9, which is continually rejected.
I shall not vote against the order. However, unless the Minister mends his ways in this respect and pays more attention to Parliament's wishes, does not indulge in these Friday manoeuvres regarding announcements, knowing that Parliament cannot question them, and does not announce the raising of sums of just under £5 million which do not need prior parliamentary approval, he will run into more trouble than he faces tonight.

11.56 p.m.

Mr. Heffer: I think that the House has at times gone well beyond the terms of the order. I make no criticism about that. We are dealing with Section 8, but we seem to have gone into Section 4 and the whole philosophy of the Tory Party. Indeed, many of my hon. Friends have expressed the philosophy of the Labour Party, too. I found the debate extremely interesting, but it must be agreed that it was somewhat wide ranging.
First, I should like to deal with the Industrial Development Advisory Board. My right hon. Friend the Paymaster-General clearly explained to the House today that when the 1972 legislation was drafted there was no provision for such a body as the IDAB. It did not exist. It was not in that proposed legislation. But, after pressure by hon. Gentlemen and possibly by their friends outside the House, the IDAB was eventually established.
I do not want to be critical of the IDAB. That would be quite wrong. However, I should point out that it is composed of 11 bankers, accountants and financiers and one trade unionist. I do not say that as a criticism of the IDAB. I merely explain the position.
The IDAB advises Ministers. We also have civil servants who advise Ministers. Do we want Ministers who must always be subservient to every piece of advice that is tendered by civil servants or outside advisers, or do we want Ministers who are prepared at times to say, "This is the Government's view", and are prepared to get up in this Chamber or anywhere else to defend their decisions? I should think that we want Ministers of that calibre, and that is the whole point.
Out of 87 cases before the IDAB, only five have been disagreed to by the Board. Again I am not criticising IDAB. I am just giving a statement of fact. It is interesting to note that three of the five happen to be concerned with workers' co-operatives. I am not suggesting that the philosophy of IDAB is against workers' co-operatives. On the contrary. I think it does a very good job on the basis of the criteria laid down by the Act. But, as I said earlier, my right hon. Friend, Ministers in the Department and, in fact, the Government as a whole certainly must take advice, and they must listen to advice, but they have to take the final decision themselves, and we believe that we have taken the right decisions in this case.
Let us consider this question of Kirkby. We are asked why we have not taken equity in Kirkby, whereas we demand equity in the case of grants and loans to private enterprise. Hon. Gentlemen should know that there are grants and loans given to private enterprise every day of the week, when there is no equity whatsoever. Often the question is not even raised. Sometimes it is raised and sometimes it is not.

Mr. Rost: rose—

Mr. Heffer: The hon. Gentleman should understand more about the Act which his Government brought in. All we are doing is administering that Act to the best of our ability and in the fairest possible way. If worker co-operatives wish to apply for assistance

in the form of loans and grants they will be treated by us as sympathetically as are private enterprise and private companies.

Mr. Rost: Could the hon. Gentleman give another example of a grant by Government to industry which is virtually a 100 per cent. grant as it is to Kirkby?

Mr. Heffer: Hon. Gentlemen opposite are now raising a question the answer to which I should like them to consider. We are giving privately and confidentially assistance to private industry every day of the week. If hon. Members do not want only the global sum of the assistance which is given but also want to be told every loan and grant, if they want every piece of information about the money that is provided to private enterprise spelt out in detail, the friends of hon. Members opposite in industry will desert them in seconds. They do not want that sort of information made public. It is not our intention, any more than it was the previous Government's, to give the details of every loan and grant under the Act to individual companies.

Mr. Robert Kilroy-Silk: My hon. Friend is aware that the grant to the Kirkby co-operative in my constituency is less than is given for the running costs of the Royal yacht in one year. Would hon. Members opposite prefer that 800 men in the factory in my constituency should be on the dole? If they would, let them say so now. Is that what they would like in an area of excessively high unemployment?

Mr. Heffer: May I ask the House to let me continue. I have five minutes left, and I will try to answer in detail some of the points which were raised by hon. Members opposite. I will ignore much of the extravagant language that was used by some hon. Members.
I was asked what was the equity stake in NVT. It was nil. It was all in preference shares. I was asked the position on the return on Section 8 investment. This is an impossible question for me to answer because some £53 million is in the form of guarantees which are being extended while the future of particular companies is being examined. Clearly, until the capital structure of those companies has been tested it is not possible to make any estimate of the return on capital.
Nearly £13 million is made up of offers made but not implemented. No precise estimate is possible.

Mr. Tim Renton: rose—

Mr. Heffer: If I give way I cannot answer all the points raised with me, some of them by the hon. Member for Mid-Sussex (Mr. Renton). I said when I started that I would try to answer the questions put to me. I do not try to dodge questions. If I do not know the answer, I am an honest enough politician to say that I do not know the answer and that I will write to an hon. Member when I get the answer. Anyone who claims to know all the answers must be God.
The export credit question which was raised refers to the special £8 million to NVT under Section 8. There is a motion on the Order Paper for support for NVT and when it comes before the House it will be discussed at great length and all the questions can be put in detail.
One hon. Member raised the point why we use equity in one case, grants in others and loans in others. The answer is simple. Each case is very different. Any hon. Gentleman who has had anything to do with the administration of the Act knows that each case is different. Therefore, one has to deal with it on an individual basis, and it is not possible to give a blanket answer that on each occasion we shall do precisely the same.
The question of Court Line was raised. My right hon. Friend explained to the satisfaction of IDAB that on that occasion, because of the short notice, he was unable to get to IDAB. We had either

to deal with the case and save thousands of jobs quickly, or alternatively, we could have gone right through the long process—[Interruption]. The hon. Member said that there were holidays, and that would be a good reason why one could not get the IDAB together quickly. [Interruption.] Is it suggested that IDAB does not have holidays?

Mr. Heseltine: It was not just that the Government were to save jobs, they were to save holidays.

Mr. Robin Corbett: That is not true. The Court Line directors said that.

Mr. Heffer: Exactly. There was no question that it was discussed at the earliest possible moment.
I cannot deal with all the points raised. I should like to deal in great detail with offshore supply because I have interesting information which could and should have been given, but I discover that I have no time left. There has been a complaint that the Department does not give the information. My goodness! The hon. Member for Tonbridge and Malling produces about three priority Written Questions a day. I do not complain about that, but he should not complain that he does not get all the information—

It being one and a half hours after the commencement of proceedings on the motion, Mr. DEPUTY SPEAKER put the Question, pursuant to Standing Order No. 3 (Exempted Business).

The House divided: Ayes 245, Noes 13.

Division No. 97.]
AYES
[12.11 a.m.


Allaun, Frank
Brown, Hugh D. (Provan)
Dalyell, Tam


Archer, Peter
Brown, Ronald (Hackney S)
Davidson, Arthur


Armstrong, Ernest
Buchan, Norman
Davies, Bryan (Enfield N)


Ashton, Joe
Callaghan, Jim (Middleton &amp; P)
Davies, Denzil (Llanelli)


Atkinson, Norman
Campbell, Ian
Davies, Ifor (Gower)


Bagier, Gordon A. T.
Canavan, Dennis
Davis, Clinton (Hackney C)


Barnett, Guy (Greenwich)
Cant, R. B.
Deakins, Eric


Barnett, Rt Hon Joel
Carmichael Neil
Dean, Joseph (Leeds West)


Bates, Alf
Cocks, Michael (Bristol S)
de Freitas, Rt Hon Sir Geoffrey


Bean, R. E.
Cohen, Stanley
Dell, Rt Hon Edmund


Benn, Rt Hon Anthony Wedgwood
Coleman, Donald
Dempsey, James


Bennett, Andrew (Stockport N)
Concannon, J. D.
Doig, Peter


Bidwell, Sydney
Conlan, Bernard
Dormand, J. D.


Bishop, E. S.
Cook, Robin F. (Edin C)
Douglas-Mann, Bruce


Blenkinsop, Arthur
Corbett, Robin
Duffy, A. E. P.


Boardman, H.
Cox, Thomas (Tooting)
Dunn, James A.


Booth, Albert
Craigen, J. M. (Maryhill)
Dunnett, Jack


Boothroyd, Miss Betty
Crawshaw, Richard
Eadie, Alex


Bottomley, Rt Hon Arthur
Cronin, John
Edelman, Maurice


Boyden, James (Bish Auck)
Crosland, Rt Hon Anthony
Edge, Geoff


Bradley, Tom
Cryer, Bob
Ellis, John (Brigg &amp; Scun)


Bray, Dr Jeremy
Cunningham, G. (Islington S)
Ellis, Tom (Wrexham)




English, Michael
Latham, Arthur (Paddington)
Rodgers, William (Stockton)


Ennals, David
Leadbitter, Ted
Rooker, J. W.


Evans, Gwynfor (Carmarthen)
Lee, John
Roper, John


Evans John (Newton)
Lestor, Miss Joan (Eton &amp; Slough)
Rose, Paul B.


Ewing, Harry (Stirling)
Lewis, Ron (Carlisle)
Ross, Rt Hon W. (Kilm'nock)


Faulds, Andrew
Litterick, Tom
Rowlands, Ted


Fernyhough, Rt Hon E.
Loyden, Eddie
Ryman, John


Flannery, Martin
Lyons, Edward (Bradford W)
Sandelson, Neville


Fletcher, Raymond (Ilkeston)
Mabon, Dr J. Dickson
Sedgemore, Brian


Fletcher, Ted (Darlingon)
McCartney, Hugh
Selby, Harry


Ford, Ben
McElhone, Frank
Shaw, Arnold (Ilford South)


Fowler, Gerald (The Wrekin)
MacFarquhar, Roderick
Sheldon, Robert (Ashton-u-Lyne)


Fraser, John (Lambeth, N'w'd)
McGuire, Michael (Ince)
Shore, Rt Hon Peter


Freeson, Reginald
Mackenzie, Gregor
Silkin, Rt Hon John (Deptford)


Garrett, John (Norwich S)
Mackintosh, John P.
Sillars, James


Garrett, W. E. (Wallsend)
McNamara, Kevin
Silverman, Julius


George, Bruce
Madden, Max
Skinner, Dennis


Gilbert, Dr John
Magee, Bryan
Small, William


Golding, John
Mahon, Simon
Smith, John (N Lanarkshire)


Gould, Bryan
Marks, Kenneth
Snape, Peter


Gourlay, Harry
Marquand, David
Spearing, Nigel


Graham, Ted
Marshall, Dr Edmund (Goole)
Stallard, A. W.


Grant John (Islington C)
Marshall, Jim (Leicester S)
Stewart, Rt Hon M. (Fulham)


Grocott, Bruce
Meacher, Michael
Stott, Roger


Hamling, William
Mendelson, John
Strang, Gavin


Hardy, Peter
Mikardo, Ian
Strauss, Rt Hon G. R.


Harper, Joseph
Millan, Bruce
Summerskill, Hon Dr Shirley


Harrison, Walter (Wakefield)
Miller, Dr M. S. (E Kilbride)
Taylor, Mrs Ann (Bolton W)


Hart, Rt Kon Judith
Miller, Mrs Millie (Ilford N)
Thomas, Dafydd (Merioneth)


Hatton, Frank
Mitchell, R. C. (Soton, Itchen)
Thomas, Mike (Newcastle E)


Heffer, Eric S.
Molloy, William
Thomas, Ron (Bristol NW)


Hooley, Frank
Moonman, Eric
Thorne, Stan (Preston South)


Horam, John
Morris, Charles R. (Openshaw)
Tinn, James


Howell, Denis (B'ham, Sm H)
Moyle, Roland
Tomlinson, John


Hoyle, Doug (Nelson)
Mulley, Rt Hon Frederick
Torney, Tom


Hughes, Rt Hon C. (Anglesey)
Murray, Rt Hon Ronald King
Wainwright, Edwin (Dearne V)


Hughes, Mark (Durham)
Newens, Stanley
Walden, Brian (B'ham, L'dyw'd)


Hughes, Robert (Aberdeen, N)
Noble, Mike
Walker, Harold (Doncaster)


Hughes, Roy (Newport)
Oakes, Gordon
Walker, Terry (Kingswood)


Hunter, Adam
Ogden, Eric
Ward, Michael


Irvine, Rt Hon Sir A. (Edge Hill)
O'Malley, Rt Hon Brian
Watkins, David


Irving, Rt Hon S. (Dartford)
Orme, Rt Hon Stanley
Watkinson, John


Jackson, Colin (Brighouse)
Ovenden, John
Watt, Hamish


Jackson, Miss Margaret (Lincoln)
Owen, Dr David
Welsh, Andrew


Janner, Greville
Palmer, Arthur
White, Frank R. (Bury)


Jay, Rt Hon Douglas
Park, George
White, James (Pollok)


Jeger, Mrs Lena
Parker, John
Whitehead, Phillip


Jenkins, Hugh (Putney)
Parry, Robert
Whitlock, William


John, Brynmor
Pavitt, Laurie
Wigley, Dafydd


Johnson, James (Hull West)
Peart, Rt Hon Fred
Williams, Alan (Swansea W)


Johnson, Walter (Derby S)
Pendry, Tom
Wilson, Rt Hon H. (Huyton)


Jones, Alec (Rhondda)
Phipps, Dr Colin
Wilson, William (Coventry SE)


Jones, Barry (East Flint)
Prescott, John
Wise, Mrs Audrey


Judd, Frank
Price C. (Lewisham W)
Woodall, Alec


Kelley, Richard
Price, William (Rugby)
Woof, Robert


Kerr, Russell
Radice, Giles
Wrigglesworth, Ian


Kilroy-Silk, Robert
Richardson, Miss Jo
Young, David (Bolton E)


Kinnock, Neil
Roberts, Albert (Normanton)



Lambie, David
Robertson, John (Paisley)
TELLERS FOR THE AYES


Lamborn, Harry
Roderick, Caerwyn
Mr. James Hamilton and


Lamond, James
Rodgers, George (Chorley)
Mr. David Stoddart.




NOES


Budgen, Nick
Lawson, Nigel
Rost, Peter (SE Derbyshire)


Fairgrieve, Russell
Lester, Jim (Beeston)
Townsend, Cyril D.


Gow, Ian (Eastbourne)
Marshall, Michael (Arundel)



Hampson Dr Keith
Mitchell, David (Basingstoke)
TELLERS FOR THE NOES:


Hordern, Peter
Ridley, Hon Nicholas
Mr. (John Farr and


Lawrence, Ivan

Mr. Nicholas Winterton.

Question accordingly agreed to.
That the Financial Assistance of Industry (Increase of Limit) Order 1975, a draft of which was laid before this House on 31st January, be approved.

Resolved,

Orders of the Day — ADJOURNMENT

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Pavitt.]

Orders of the Day — LONDON TRANSPORT (ATTACKS ON STAFF)

12.21 a.m.

Mr. Cyril D. Townsend: I welcome this opportunity to raise the growing problem of assaults by hooligans on London Transport staff on both bus and rail. There is considerable public concern following the tragic death of a conductor a few weeks ago as a result of a vicious assault while he was on duty.
I was first made aware of the problem some four years ago when I was working at County Hall and was taken on a visit to London Transport where the figures were explained to me. The unions, of course, have known about the problem for rather longer than that. They have been lobbying various Home Secretaries since 1966.
Last year there were 1,059 assaults on bus staff and 273 on railway staff. In 1973 there were 911 assaults on bus staff and 228 on railway staff. In my borough of Bexley during the last 12 months there were eight assaults on bus crews compared with six assaults in the previous 12 months. There have been two incidents recently. Last December a crewman was assaulted twice within a month and threatened with a knife. Recently a driver-operator, while driving a one-man-operated bus—such a bus can carry up to 80 people—was struck repeatedly on the head with a piece of wood. Luckily we have not yet had in my borough an incident quite as ghastly as the case in another borough of a 56-year-old conductress who was sexually assaulted, knocked down and then kicked unconscious.
Time prevents me from coupling with the assaults the vandalism on London Transport. London Transport has told me, however, that about 20,000 light bulbs are destroyed each year along with about 1,000 fire extinguishers, and the annual bill is about £25,000. That bill is met by the travelling public.
It is alarming that youngsters are increasingly responsible for assaults—I believe that they are involved in 30 per cent. of cases. There seems to be no set pattern. When public houses are closing and discotheques are finishing there is a certain rush, as there is when schools finish in the afternoon. I am told that some of the worst assaults have happened

outside these set hours. Leaving aside the effect on the victims, the results of such attacks are, first, the loss of mileage by London Transport buses. Secondly there are considerable gaps in the service. Bexley, being an outer London borough, suffers particularly from this. Many of those who curse London Transport for not supplying a bus according to schedule late at night are unaware that the reason is that the driver or conductor has had a punch-up further up the route.
Recruiting is bound to suffer. There is a serious shortage of London Transport staff. The tragedy is that such assaults are turning the travelling public away from public transport at a time when we are all, in all parties, determined to try to get them back on it.
I do not deny that the problem is part of a big problem of violence that haunts the centres of our major conurbations. In part it is connected with the rising levels of juvenile delinquency. Perhaps the inadequacies of the 1969 Act have something to do with that. It is also connected with the shortage of police, particularly Metropolitan Police.
What can and must be done by the authorities? I take the buses first. Certain hooters are being installed. They are complementary to two-way radios, and no substitute for them. About 120 buses out of 6,000 are fitted with such a device, as well as flashing lights. London Transport kindly invited me to a demonstration last Friday, when I was impressed with the hooter that was demonstrated.
The installation of radios is of major importance. I am told that it will take many years to complete the programme. It should be speeded up. Only about 300 sets have been fitted so far. One of the hold-ups is in the provision of sites for the main aerials. I appeal for better co-operation from the London boroughs. I have been told that planning applications take from 12 to 15 months. The Royal Borough of Kensington has apparently delayed since June over an important site. It should be able to work a little quicker than that. Centre Point has considerable potential for at least something—perhaps an aerial. Again, there is a hold up. Perhaps the co-operative movement will be able to help.
There is a need for more channels for the sets. They need at least 20, and I understand that only 15 have been allocated by the Home Office for London Transport. Why is it that a new taxi cab operator appears to be able to get a channel comparatively easily while London Transport stems to be stuck on 15?
Finance is never far from the question. I urge the Government to help with subsidies so that the radios can be installed without delay.
On the Underground, closed circuit television is a possibility in certain trouble spots. London Transport is experimenting with ticket collectors' boxes which give greater protection.
The nub of the matter appears to be that the penalties available, which I believe are sufficient, are not being imposed. I have been appalled by the light sentences being given when the culprit is caught—and it is very rare that he is. In many cases the criminal is out of prison before the bus conductor or conductress is out of hospital and back at work.
Time prevents my going into details, but I have a record compiled by London Transport of offences and sentences. It shows that the position has become ludicrous. A driver was attacked by four youths and kicked and punched about the body, suffering bruising to both legs. Four youths were convicted of assaulting a bus driver, and one was also convicted of fare evasion. They were fined £10 each and ordered to pay £5 costs. That is no suitable sentence.
I take another case. A conductor was punched about the face, causing bruising and damage to his spectacles. A man was convicted of assaulting the conductor and damaging a pair of spectacles. He was conditionally discharged and ordered to pay £8 compensation.
I hope that the Minister will be able to say whether the Lord Chancellor has sent out a letter on the need for sentences which will provide some respectable deterrent. I appreciate that magistrates must have some discretion, but I suspect that the Minister will agree that the position at the moment is totally unsatisfactory. I appreciate too, that it is difficult for the Home Office, but, in the

past, the Lord Chancellor has given instructions or guidance, and I hope that this may happen in this case.
Following a meeting on 3rd February between respresentatives of the union and the Home Secretary, apparently the union has been waiting for a statement in the House by the right hon. Gentleman. Perhaps we may be told what has happened to that statement.
I believe that there is a clear need for the legal powers of the police to be extended. What can the Home Office do to speed this up? I hope that we shall not have to wait for the Law Revision Committee to report.
It has been suggested that London bus crews are public servants and, as such, should have the same protection as law enforcement officers. What are the Minister's views about that? What is the Home Office doing to find out how similar problems have been tackled abroad—for example, in Hamburg or Detroit?
What advice is the Home Office giving members of the public who may witness such an incident? I appreciate that this is a difficult one to judge, but my own advice would be to observe and to report by telephone to the police as quickly as possible. However, clearly there are cases, especially where youngsters are involved—perhaps rowdy kids on the way home from school—where the public should be prepared to step in to protect a conductor or driver. After all, the conductors and drivers are there to help the travelling public, to help individuals, and they should be helped from time to time in return.
Much more must be done to get posters displayed in the proper places on London Transport—for example, in buses and on the Underground—pointing out the penalties for assaults on London Transport staff and drawing the public's attention to the amount of vandalism which takes place on public transport in London.
Much more needs to be done to obtain better public understanding of what is at stake. We all know how public opinion takes a long time to be aroused. It was aroused by the murder a few weeks ago. It was not aroused, apparently, by the record of assaults stretching back many a year.
There is a tremendous need for speedy and determined action by all the authorities concerned. Public transport services in our capital are under a very real threat.

12.33 a.m.

The Under-Secretary of State for the Home Department (Dr. Shirley Summerskill): I welcome the fact that the hon. Member for Bexleyheath (Mr. Townsend) has chosen to raise the serious problem of attacks on London Transport staff, which, regrettably, have become a feature of urban life in recent years and which are to be deeply deplored.
We were all shocked by the tragic death of Mr. Ronald Jones, a conductor, last month, and on behalf of the Government I take this opportunity of expressing my sympathy to Mr. Jones's family and colleagues.
On 3rd February, the General Secretary and other officials of the Transport and General Workers' Union, and the Chairman of London Transport, came to see my right hon. Friends the Home Secretary and the Minister for Transport to discuss measures which might improve the situation. My right hon. Friends agreed to take action on a number of points. I think it fair to say that the announcement of the action the Government proposed to take was received with approval by both employers and unions, as evidence of the Government's determination to deal with the problem. My right hon. Friend issued a full Press statement on 3rd February containing the immediate results of the meeting. We hope that the measures to be taken will help to improve the situation.

Mr. Townsend: At this point, will the Minister let us know what is happening about the statement to the House?

Dr. Summerskill: I shall certainly refer the hon. Member's request to my right hon. Friend.
There can be no doubt that misconduct on buses and underground trains, of which assaults on staff are the most serious feature, is a growing problem. The hon. Gentleman gave some figures and descriptions to illustrate this. Perhaps I might supplement his figures.
In 1972, 669 assaults on London Transport staff were reported to the police.

The equivalent figure for 1973 was 771. the corresponding figure for 1974 is not yet available, but there can be no doubt it will show a further increase.
Statistics for 1974 are available, however, for the number of incidents on buses considered worthy of report to the police in 1974—and, in fact, 849 such incidents on buses were reported. Not all involved assaults on staff—though most did—and conversely not all assaults will have been reported. Nevertheless it is an alarmingly high figure. Analysis shows, as the hon. Gentleman has indicated, that 28 per cent. of these incidents occurred between 3 p.m. and 6 p.m. and 22 per cent. between 10 p.m. and midnight. In no fewer than 70 per cent. of the cases—589 in all—the offender was never identified. In a further 190 cases, names and addresses were exchanged, and in 70, arrests were made. These statistics underline the major problem in dealing with assaults on bus crews—the problem of getting police to the scene before the offender has fled.
The total London Transport bus fleet consists of 6,500 buses. They travel many millions of miles every year. This poses particular problems in terms of law enforcement. The Metropolitan Police—whose resources are already stretched in other directions—cannot be everywhere at once. When an assault is committed in present circumstances it will usually take some time for the police to be summoned, and when they arrive the offenders have often long since left the scene. Police must be got to the scene of an assault more quickly if they are to have any chance of catching offenders.
In this connection radio is potentially of very great importance on the theory that a violent assault will usually be preceded by a few minutes of minor disturbance, during which the police may be alerted. Other cities in the United Kingdom, including Leicester and Glasgow, have found bus radios helpful—not only in dealing with assaults, but also in maintaining regular services. London Transport has 300 buses fitted with two-way radios, and the intention is to have 1,000 equipped by the end of the year. Bus operators have been advised that part of the cost of installation can be met by grant. One difficulty is that the public service vehicle regulations do not at


present permit bus drivers to speak by radio when their vehicles are in motion. The Department of the Environment is drafting regulations to overcome this problem. There is nothing to prevent their installation or use while stationary.
In addition, two types of alarm system have been under consideration. One is the klaxon or siren alarm, but this carries the risk of confusion with that of an emergency services vehicle. London Transport and others concerned have also been considering the form of alarm which depends on continuous flashing of the indicator lights and sounding the horn. I understand that a number of alarm systems were demonstrated to the police and others interested at the Victoria Garage on Friday 14th February last.
A provisional decision was made in favour of an alarm system which flashes the lights and sounds the horn intermittently and more loudly. London Transport has already equipped some of its fleet with a form of this system on an experimental basis. Amending regulations are being prepared by the Department of the Environment as a matter of urgency.
The Metropolitan Police, for their part, have been doing what they can within the limits of their resources to extend the protection given to bus crews. In October of last year they established a new formal system of liaison with London bus garages. Over 60 garage liaison officers of the rank of inspector have been appointed. They attend the regular meetings of the local garage consultative committees on which employers and staff are represented. They are available for informal consultation at any time. The Metropolitan Police held a seminar on this subject on 31st January which was addressed by representatives of the Transport and General Workers' Union and London Transport. They are also taking a close and continuing interest in proposals for alarms and other possible improvements.
My right hon. Friend the Home Secretary regards close liaison between the police and the employers and the unions as an important factor, particularly in the opportunity it provides for identifying the main trouble spots, analysing the causes of the trouble and discussing specific plans for dealing with it.
The Chairman of London Transport has told the Home Secretary that he will propose to his Executive that police officers should be allowed to travel free on buses in the hope that, if they were encouraged to use bus services, their presence would provide added protection for the crews. This proposal is under careful consideration.
My right hon. Friend has also announced his acceptance of the need to give the police more powers to deal with offenders. Of course, they already have the power to arrest where an arrestable offence has been committed and they arrive on the scene in time to apprehend the offender. But they have no power to arrest for a breach of the Public Service Vehicles (Conduct of Drivers, Conductors and Passengers) Regulations 1936, which govern the behaviour of passengers and crew members. At present offences against these regulations—they cover a wide range from riotous or disorderly conduct, or refusing to pay one's fare, to spitting or distracting the driver—can be prosecuted only by way of summons.
My right hon. Friends consider this to be the right method of enforcement in principle, but its effectiveness depends on obtaining the offender's name and address. As the regulations stand, an offending passenger may be required by the driver or conductor, or by a police officer, to give his name and address, refusal to do so being in itself an offence. Clearly if the offender leaves the bus without giving his correct name and address he cannot be brought to court. My right hon. Friend announced, following his meeting with London Transport and the union leaders, that the law would be amended as soon as possible to provide the police with powers of arrest to deal with this situation. My right hon. Friend the Home Secretary is taking steps to ensure that the necessary legislation is prepared as a matter of urgency.

Mr. Townsend: Will the hon. Lady confirm that we are not waiting for the Criminal Law Revision Committee to report? That would obviously delay matters.

Dr. Summerskill: If I may I will confirm that point by letter but I think I am right in saying that we are not waiting for the Committee to report. I


hope that the hon. Gentleman will not take what I have said as being definite.
The hon. Gentleman raised the extremely important matter of penalties. I know that union leaders are concerned about the penalties imposed by the courts on those offenders who are traced and prosecuted.
As the hon. Gentleman realises, this is a matter for the courts and my right hon. Friend has now power to intervene. However, my noble Friend the Lord Chancellor has taken the opportunity of an address to a branch of the Magistrates' Association to draw attention to the seriousness of the problem of assaults on public transport workers.
I also wish to refer the hon. Gentleman to some recent remarks made by Judge Sebag Montefiore when sentencing a first offender for punching a bus conductor on an East London bus. The judge said:
Bus crews are entitled to look to judges for and the enforcement of law for protection. Anyone who appears before me on such offences,

whether he has previous convictions or not, will receive a custodial sentence.
I have noted all the other points and suggestions made by the hon. Gentleman and they will receive careful consideration. Those who man our public transport system perform a vital public service. They deserve public support. If assaults continue, there can be no doubt that more men and women will leave the industry—with the effect of reducing the efficiency of London's public transport system. Buses and trains are run for the benefit of the public, but behaviour of this kind can have only the effect, in the long term, of reducing the service available to them. Busmen in particular suffer because they are isolated targets for drunken and loutish misbehaviour. Their morale has been somewhat shaken and, as my right hon. Friend the Home Secretary has indicated, the Government intend to do all they can to support them in the vital work they do.

Question put and agreed to.

Adjourned at thirteen minutes to One o'clock.